S. 220: Workforce Mobility Act of 2023

This bill prohibits the use of noncompete agreements in the context of commercial enterprises except under certain circumstances.

The first exception is that the seller of a business entity may enter into an agreement to refrain from engaging in a similar business in the geographic area where the business being sold has conducted business prior to the agreement. This exception extends to agreements by senior executive officials who have a severance agreement as part of the conditions of sale (i.e., a buyout provision). Second, a partner of an enterprise may enter into an agreement that, upon dissolution of the partnership or dissociation of the partner from the partnership, the partner will refrain from engaging in a similar business in the geographic areas where the partnership has conducted business prior to the agreement.

Commercial enterprises must post notice of the prohibition of noncompete agreements under this bill in a conspicuous area of the workplace and conduct a public awareness campaign to inform the public of the provisions of this bill.

Written by the Congressional Research Service, Library of Congress.