Non-compete agreements and the fact that they are frequently abused have been a newsworthy topic in the last few years. Previously, I've discussed the negative reaction to Jimmy John's Gourmet Sandwiches restricting its sandwich-makers from working for competitors through non-compete agreements.
Well, apparently Jimmy John's is not the only restaurant to try to restrain its workforce. Within the past year, reports have surfaced that several restaurants are being investigated for using agreements that restrict employees of one franchisee from working for other franchisees. The restaurants include: Burger King, Wendy's, Arby's, Panera, Dunkin' Donuts, Five Guys, Little Caesars and Popeyes Louisiana Kitchen.
It appears these restaurants require a franchisee to agree in the franchise agreement that it will not poach or hire another franchisee's employees. While this is not a true non-compete, this practice still impacts low-wage fast food workers' ability to pursue other job opportunities. It may also have antitrust implications.
Many states have recently implemented laws that limit the types of employees who may be subject to non-competes. Georgia's non-compete statute specifically limits the types of employees who can be subject to non-competes. These laws will hopefully go a long way toward curbing the abuse of non-competes for low-wage workers which we now know is pervasive – even in the fast food industry.
For more information, see my blog at www.bfvlaw.com
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