II 

117TH CONGRESS 

1ST SESSION S. 2375 

To amend the Fair Labor Standards Act of 1938 to prevent employers 

from using non-compete agreements in employment contracts for certain 

non-exempt employees. 

IN THE SENATE OF THE UNITED STATES 

JULY 15, 2021 

Mr. RUBIO (for himself and Ms. HASSAN) introduced the following bill; which 

was read twice and referred to the Committee on Health, Education, 

Labor, and Pensions 

A BILL 

To amend the Fair Labor Standards Act of 1938 to prevent 

employers from using non-compete agreements in employment contracts for certain non-exempt employees. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Freedom To Compete 

5 Act’’. 

6 SEC. 2. LIMITATION ON NON-COMPETE AGREEMENTS. 

7 (a) IN GENERAL.—The Fair Labor Standards Act of 

8 1938 (29 U.S.C. 201 et seq.) is amended by inserting 

9 after section 7 the following: 


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1 ‘‘SEC. 8. LIMITATION ON NON-COMPETE AGREEMENTS. 

2 ‘‘(a) DEFINITION OF NON-COMPETE AGREEMENT.— 

3 In this section, the term ‘non-compete agreement’ means 

4 an agreement, entered into between an employer and an 

5 employee, that restricts such employee from performing, 

6 after the employment relationship between the employer 

7 and the employee terminates, any of the following: 

8 ‘‘(1) Any work for another employer for a speci9 fied period of time. 

10 ‘‘(2) Any work in a specified geographical area. 

11 ‘‘(3) Any work for another employer that is 

12 similar to such employee’s work for the employer 

13 that is a party to such agreement. 

14 ‘‘(b) IN GENERAL.— 

15 ‘‘(1) NO ENFORCEMENT OF NON-COMPETE

16 AGREEMENTS.—Any non-compete agreement entered 

17 into before the date of enactment of the Freedom to 

18 Compete Act shall be void and have no effect. An 

19 employer shall not enforce, or threaten to enforce, 

20 any non-compete agreement with an employee. 

21 ‘‘(2) NO NEW NON-COMPETE AGREEMENTS.— 

22 Beginning on the date of enactment of the Freedom 

23 to Compete Act, an employer shall not enter into, 

24 extend, or renew any non-compete agreement with 

25 an employee. 


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1 ‘‘(3) LIMIT ON APPLICABILITY.—This sub2 section shall not apply with respect to any employee 

3 described in section 13(a)(1). 

4 ‘‘(c) RULE OF CONSTRUCTION REGARDING TRADE

5 SECRETS.—Nothing in this section shall preclude an em6 ployer from entering into an agreement with an employee 

7 to not share any information (including after the employee 

8 is no longer employed by the employer) regarding the em9 ployer or the employment that is a trade secret, as defined 

10 in section 1839 of title 18, United States Code.’’. 

11 (b) ENFORCEMENT.— 

12 (1) PROHIBITED ACT.—Section 15(a) of the 

13 Fair Labor Standards Act of 1938 (29 U.S.C. 

14 215(a)) is amended— 

15 (A) in paragraph (5), by striking the pe16 riod at the end and inserting a semicolon; and 

17 (B) by adding at the end the following: 

18 ‘‘(6) to violate any of the provisions of section 

19 8.’’. 

20 (2) PENALTIES.—Section 16 of the Fair Labor 

21 Standards Act of 1938 (29 U.S.C. 216) is amend22 ed— 

23 (A) in subsection (a), by inserting ‘‘, ex24 cept that a person convicted of a violation of 


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1 section 15(a)(6) shall not be subject to impris2 onment’’ after ‘‘or both’’; 

3 (B) in subsection (b), by inserting ‘‘Any 

4 employer who violates the provisions of section 

5 8 shall be liable for such legal or equitable relief 

6 as may be appropriate to effectuate the pur7 poses of such section.’’ after the third sentence; 

8 (C) in subsection (c), by adding at the end 

9 the following: ‘‘The authority and requirements 

10 described in this subsection shall also apply 

11 with respect to a violation of section 8, as ap12 propriate, and the employer shall be liable for 

13 such legal or equitable relief as may be appro14 priate to effectuate the purposes of such sec15 tion.’’; and 

16 (D) in subsection (e)(2), by striking ‘‘sec17 tion 6 or 7, relating to wages,’’ and inserting 

18 ‘‘section 6, 7, or 8, relating to wages or non19 compete agreements,’’. 

20 (c) CONFORMING AMENDMENT.—Section 10 of the 

21 Fair Labor Standards Act of 1938 (29 U.S.C. 210) is re22 pealed. 

23 (d) EFFECTIVE DATE.— 


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1 (1) IN GENERAL.—The amendments made by 

2 this Act shall take effect 180 days after the date of 

3 enactment of this Act. 

4 (2) APPLICABILITY.—This Act, and the amend5 ments made by this Act, shall apply with respect to 

6 any dispute or claim for which proceedings com7 menced on or after the effective date described in 

8 paragraph (1). 

Æ 


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