HouseH.R. 10879119th Congress
Workers’ Right to Compete Act
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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 10879 Introduced in House (IH)]
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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.
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