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[Congressional Bills 119th Congress] [From the U.S. Government Publishing Office] [H.R. 10879 Introduced in House (IH)] <DOC> 119th CONGRESS 2d Session H. R. 10879 To prohibit noncompete agreements for workers whose annual income falls below specified thresholds, and for other purposes. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES October 22, 2026 Mr. Khanna (for himself and Mrs. Luna) introduced the following bill; which was referred to the Committee on Energy and Commerce _______________________________________________________________________ A BILL To prohibit noncompete agreements for workers whose annual income falls below specified thresholds, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Workers' Right to Compete Act''. SEC. 2. DEFINITION. In this Act: (1) Confidential business information.-- (A) In general.--The term ``confidential business information'' means nonpublic commercial, financial, operational, or proprietary information that-- (i) is not generally known or readily ascertainable by the public; (ii) the employer has a legitimate business interest in maintaining as confidential; and (iii) is subject to reasonable measures by the employer to maintain its confidentiality. (B) Exclusions.--The term ``confidential business information'' does not include-- (i) general knowledge, skills, training, or experience acquired by an individual during employment; or (ii) information that is publicly available or otherwise lawfully obtained without an obligation of confidentiality. (2) Noncompete agreement.--The term ``noncompete agreement'' means an agreement between a person and an individual performing work for the person, that restricts such individual, after the working relationship between the person and individual terminates, from performing-- (A) any work for another person for a specified period of time; (B) any work in a specified geographical area; or (C) any work for another person that is similar to such individual's work for the person that is a party to such agreement. (3) Trade secret.--The term ``trade secret'' has the meaning given the term in section 1839 of title 18, United States Code. SEC. 3. PROHIBITING NONCOMPETE AGREEMENTS. (a) Prohibition.-- (1) In general.--No person shall enter into, enforce, or attempt to enforce a noncompete agreement with any individual who is or was employed by, or performs or previously performed work under contract with, such person with respect to the activities of such person in or affecting commerce, if the actual or expected annualized rate of cash compensation from such person for such individual is less than $100,000, as adjusted annually for inflation in accordance with paragraph (2). (2) Inflation adjustment.--For each calendar year after 2026, the dollar amount specified in paragraph (1) shall be increased by an amount equal to-- (A) such dollar amount; multiplied by (B) the percentage by which the Consumer Price Index for All Urban Consumers for the preceding calendar year exceeds such index for calendar year 2026. (3) Effect of agreements.--Any noncompete agreement prohibited under paragraph (1) shall be unenforceable, including any agreement entered into before the date of enactment of this Act. (4) Compensation determination.--For purposes of paragraph (1), the annualized rate of cash compensation of an individual shall be determined-- (A) in the case of a current employee or contractor, at the time the noncompete agreement is imposed as a condition of employment or at the time enforcement is sought; and (B) in the case of a former employee or contractor, at the time the individual's employment or contractual relationship terminated. (5) Variable compensation.--For purposes of determining the annualized rate of cash compensation under paragraph (4) of a current employee or contractor-- (A) in the case of an individual who has been employed or engaged under contract for at…
least 12 months, commissions, bonuses, and other variable cash compensation shall be calculated based on amount earned during the preceding 12 months; and (B) in the case of an individual who has been employed or engaged under contract for fewer than 12 months, commissions, bonuses, and other variable cash compensation shall be included only to the extent such compensation is guaranteed. (b) Cash Compensation Defined.--In this section, the term ``cash compensation'' means compensation in the form of a salary, wage, overtime pay, commission, and cash bonus, or fee for services performed under contract paid or payable to an individual in exchange for services performed but does not include equity or equity-based compensation or any other compensation based on the value or appreciation of stock, regardless of whether such compensation is paid or settled in cash. SEC. 4. NOTICE. (a) Notice.--Any person who employs or contracts with an individual described in section 3, or who previously employed or contracted with such an individual and entered into a noncompete agreement with such individual, with respect to activities in or affecting commerce, shall provide such individual with written notice that any noncompete agreement prohibited under this Act is unenforceable, not later than-- (1) 30 days after the date of enactment of this Act, for an existing or former employment or contractual relationship; or (2) 30 days after the commencement of any new employment or contractual relationship entered into after the date of enactment of this Act. SEC. 5. ENFORCEMENT. (a) Federal Trade Commission.-- (1) Unfair or deceptive acts or practices.--A violation of section 3 or 4 shall be treated as a violation of a rule defining an unfair or deceptive act or practice prescribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)). (2) Powers of commission.-- (A) In general.--The Federal Trade Commission shall enforce section 3 and 4 in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms and provisions of the Federal Trade Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a part of this Act. (B) Privileges and immunities.--Any person who violates section 3 or 4 shall be subject to the penalties and entitled to the privileges and immunities provided in the Federal Trade Commission Act (15 U.S.C. 41 et seq.). (C) Authority preserved.--Nothing in this Act shall be construed to limit the authority of the Federal Trade Commission under any other provision of law. (b) Enforcement by States.-- (1) In general.--In any case in which the attorney general of a State has reason to believe that an interest of the residents of the State has been or is threatened or adversely affected by any person who violates any provision of section 3 or 4, the attorney general of the State, as parens patriae, may bring a civil action on behalf of the residents of the State in an appropriate State court or an appropriate district court of the United States to-- (A) enjoin any further such violation by the person; (B) compel compliance with section 3 or 4; (C) obtain a permanent, temporary, or preliminary injunction; (D) obtain damages, restitution, or other compensation on behalf of the residents of the State; or (E) obtain any other appropriate equitable relief. (2) Preservation of state powers.--Nothing in this subsection shall be construed as altering, limiting, or affecting the authority of the attorney general of a State to-- (A) bring an action or other regulatory proceeding arising solely under the laws in effect in that State; or (B) exercise the powers conferred on the attorney general by the laws of the State, including the ability to conduct investigations, administer oaths or affirmations, or compel the attendance of witnesses or the production of documentary or other evidence. SEC. 6. NO PREEMPTION OF STRONGER STATE LAWS. Nothing in this Act shall be construed to preempt or supersede any State law that provides greater protection against noncompete agreements than those provided under this Act. SEC. 7. CONFIDENTIALITY AGREEMENTS. Nothing in this Act shall prohibit a person from entering into an agreement with an individual who is employed by, or performs work under contract with, such person with respect to the activities of such person in or affecting commerce to not disclose any information (including after the individual is no longer employed or performing work for the person) regarding the person, or the work performed by the individual for the person, that is a trade secret or confidential business information. <all>
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