The proposed legislation aims to enhance competition and economic growth in Washington by prohibiting noncompetition agreements for all workers and businesses within the state. The bill recognizes that such covenants hinder innovation, suppress wages, and limit job mobility, ultimately harming consumers and the economy. It builds on previous legislation that banned noncompetition covenants for lower-wage earners, asserting that a broader ban is necessary to protect workers across all sectors. The bill also clarifies the nature of nonsolicitation agreements, which are not prohibited but must be narrowly defined.

Key amendments include the declaration that all noncompetition covenants are void and unenforceable, regardless of when they were entered into, and it establishes penalties for employers who attempt to enforce such agreements. The bill mandates that employers notify current and former employees about the unenforceability of any noncompetition covenants by October 1, 2027. Additionally, it repeals certain existing laws related to noncompetition agreements and clarifies definitions and enforcement mechanisms within the chapter. The act is set to take effect on June 30, 2027.

Statutes affected:
Original Bill: 49.62.005, 49.62.010, 49.62.020, 49.62.080, 49.62.090, 49.62.100
Substitute bill: 49.62.005, 49.62.010, 49.62.020, 49.62.080, 49.62.090, 49.62.100