One curiosity of the broadcast business is that stations can decide they don’t want an anchor or a reporter around anymore, but they don’t want the person to “go across the street.” So, for decades, stations have forced employees to sign “non-compete” agreements that say for a period of time after leaving a station, often a year, the employee cannot appear on a competitor’s air. Stations feel that they put a lot of promotion behind their on-air staff and don’t want a competitor using the name recognition against them.
That means when broadcasters lose their jobs, they often have to move to another city to find work because they cannot work for a competitor. I have known people who have been laid off due to staffing cuts but are forbidden from finding jobs in town. It is not like they violated their contract and quit.
Thursday, New York Governor David Paterson signed the Broadcast Employees Freedom to Work Act, which removes the power of non-compete clauses. The legislation applies to TV, radio, cable and even satellite broadcasters. Read the bill here.
Other states, including Arizona, California, Illinois, Massachusetts, Maine and Arizona (and Washington, D.C.) have limits on non-competes.
AFTRA (American Federation of Television & Radio Artists), a union that represents some broadcast employees, offers these thoughts on the New York non-compete legislation:
Aren’t Non-Competes Used in Other Industries?
In other industries, such as the high-tech industry, non-compete provisions are justified on the grounds that they are necessary to protect the disclosure of “trade secrets” or “confidential information” belonging to a former employer. This rationale is not applicable in broadcasting. Broadcasters are simply not privy to “trade secrets,” “confidential information” or any other proprietary interests of a former employer. …
Why Can’t Broadcasters Just Challenge Non-Competes in Court?
Although non-competes are regularly struck down by courts when challenged by non-confidential employees such as broadcasters, this is not an effective solution to the problem. First, the broadcasters most affected by non-compete clauses simply do not have the resources to hire attorneys to fight them. Second, since such litigation will generally take far longer to resolve than the term of a non-compete, there is little incentive for broadcasters to spend the money to challenge such clauses in court. Third, litigation is not a solution because even if ultimately unenforceable, such clauses have the effect of discouraging other stations from making competing offers.
Are Non-Competes Banned in Other States?
