A Competition Law Perspective on Why Non-Compete Clauses in Employment Contracts Should be Banned

Stephan, Andreas (2026) A Competition Law Perspective on Why Non-Compete Clauses in Employment Contracts Should be Banned.

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Abstract

This article examines the status of non-compete clauses (NCCs) in employment contracts through the lens of competition law. Although traditionally governed in England and Wales by the common law restraint of trade doctrine, NCCs have attracted increasing scrutiny amid concerns about their labour market effects. While competition authorities have treated wage-fixing and no-poach agreements as restrictions of competition by object under Article 101 TFEU and the Competition Act 1998, NCCs generally fall outside competition where they are applied to employment contracts. The article argues, however, that NCCs share material similarities with labour market cartels and generate comparable distortions, including suppressed wages and reduced mobility. Applying the principle of ancillary restraints, it contends that employment NCCs are equivalent to practices that have as their object the significant restriction of competition. Given the availability of less restrictive means to protect legitimate employer interests, the article concludes that incremental reform is inadequate and advocates a comprehensive statutory ban in the UK.

Item Type:	Article
Faculty \ School:	Faculty of Social Sciences > School of Law
UEA Research Groups:	Faculty of Social Sciences > Research Groups > Competition, Markets and Regulation Faculty of Social Sciences > Research Centres > Centre for Competition Policy
Related URLs:	https://papers.ssrn.com/sol3/papers.cfm?...
Depositing User:	LivePure Connector
Date Deposited:	30 Apr 2026 12:38
Last Modified:	30 Apr 2026 12:38
URI:	https://ueaeprints.uea.ac.uk/id/eprint/102847
DOI:

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