Bipartisan House Bill Seeks to Ban Non-Compete Agreements for Workers Earning Under $100,000

In a rare show of bipartisan cooperation in the current political landscape, Representative Ro Khanna, D-Calif., and Representative Anna Paulina Luna, R-Fla., have introduced the Workers’ Right To Compete Act. The legislation aims to prohibit companies from imposing non-compete agreements on any employees earning less than $100,000 annually, a move the sponsors argue will liberate workers and stimulate economic growth.

If enacted, the bill would take immediate and sweeping effect. It is designed to ban both future and pre-existing non-compete agreements within 30 days of passage. This retroactive provision would effectively nullify existing contracts that prevent employees from moving to competitors or starting their own ventures, allowing those previously bound by such restrictions to immediately seek new employment or higher wages.

Representative Luna framed the bill as a matter of economic liberty and individual agency. She argued that independent contractors and other hardworking Americans should have the freedom to advance their careers without facing “unnecessary legal red tape.” According to Luna, the legislation is intended to put workers back in charge of their own earning potential and professional opportunities.

Representative Khanna emphasized the bill’s potential to spark innovation, pointing to California’s long-standing ban on non-compete enforcement as a primary reason for the success of Silicon Valley. He noted that the free flow of talent between technology giants has been essential for the industry’s evolution. As a specific example, Khanna cited the founding of the AI firm Anthropic by Dario Amodei. He argued that if Amodei had been restricted by a non-compete agreement with his former employer, OpenAI, the new startup—and the competition it provides—might never have existed.

Khanna suggested that without these protections, the technology sector could stagnate under a handful of monopolists. He pointed to the constant movement of talent from companies like Google and NVIDIA to newer entities as proof that labor mobility drives a healthy ecosystem. While the current bill sets a $100,000 threshold, Khanna indicated he would personally support an even higher floor, but viewed this specific figure as a viable starting point for meaningful bipartisan legislation.

Economic data included in the reporting supports the bill’s goals. A study from the Federal Reserve Bank of Minneapolis found that when Oregon stopped enforcing non-compete agreements for hourly workers, wages for those employees rose by 2% to 3%. Furthermore, private equity firm KKR & Co. has already begun implementing similar policies. Pete Stavros, KKR’s co-head of global private equity, noted that the firm prohibited non-competes for employees making under $100,000 at companies it acquired, finding that the move actually improved economic performance without negative consequences.

The legislative push comes after a previous attempt by the Federal Trade Commission (FTC) to ban such agreements nationwide was derailed. The FTC voted on a broad rule to eliminate non-competes in 2024, but the effort was abandoned after it was struck down by a federal district court. By pursuing the ban through a bipartisan act of Congress, Khanna and Luna are attempting to create a permanent legislative fix that could withstand the legal challenges that hampered the previous regulatory approach.

Khanna expressed optimism that the bill could serve as a unifying force following the election cycle, noting that figures as ideologically diverse as himself, Luna, and Vice President JD Vance have all expressed skepticism toward the enforceability of non-competes. “It is something that has worked in California and Silicon Valley,” Khanna said, describing the proposal as “pro-innovation, pro-growth, and pro-wages.”