Today the Governor announced an economic development bill that includes a key provision that will drive innovation and job growth in Massachusetts—the elimination of non-compete agreements.
Companies use non-competes to hold employees captive and stifle competition all in the name of protecting intellectual property. The truth is that intellectual property is well protected by the use of non-disclosure and non-solicitation agreements. Additionally, Governor Patrick is proposing stronger enforcement of the Uniform Trade Secrets Act to go hand-in-hand with the elimination of non-competes.
The consequence of non-competes has been a brain drain as employees who would be compelled to start new companies or join other early stage companies in Massachusetts instead leave the state for fear of being taken to court by their former employers. California, New York and other states with thriving tech economies banned non-competes long ago—and have benefitted from our use of them.
Members of the startup community including Bijan Sabet at Spark Capital, Jeremy Hitchcock at Dyn, and Jeff Bussgang at Flybridge have been explaining for years that non-competes inhibit job growth and new company creation.
Meanwhile, several large Massachusetts companies have spent hundreds of thousands of dollars to lobby against previous efforts to end non-competes. This time, we will not let them have the last word.
Today, the New England Venture Capital Association—on behalf of our 700 members and the thousands of talented people working inside our Massachusetts-based portfolio companies—asks you to help drive innovation and job creation by asking your senator and representative to support the governor’s Economic Development Bill and, specifically, issue your support for ending non-compete agreements.
Let’s level the playing field with California and other states who understand that non-competes impede growth. Let’s create an environment in Massachusetts that allows the creation of 100 new EMCs, 100 new Boston Scientific’s. Abolishing non-competes will free talented people to start and join new companies that will create thousands of jobs and grow state revenues.
The New England Venture Capital Association applauds the work of the Patrick administration in advancing this bill, and that of the many other forward-thinking legislators who will create jobs in the Commonwealth by backing it. Encouraging Beacon Hill to do the right thing to promote job creation requires the vocal support of our startup community.