Hochul Plans to Veto Ban on Noncompete Agreements in New York

Gov. Kathy Hochul plans to veto a bill that would have banned the use of noncompete agreements in New York after a furious lobbying effort by Wall Street and other powerful industries that forcefully opposed the measure, according to two people with knowledge of the negotiations over the bill. Ms. Hochul was expected to veto the bill later on Friday.

Democrats in control of the State Legislature passed the bill in June, wanting New York to join other states that have cracked down on the use of noncompete agreements, which companies use to bar employees from working for a competitor for a set amount of time after leaving a job.

The bill’s supporters argued that the agreements have unfairly trapped an array of workers, from hairstylists to engineers and doctors, who sign away their right to leave for a competitor.

But Ms. Hochul, a fellow Democrat, believed the ban went too far, and she attempted to narrow its scope so that it applied only to lower wage workers. The ban was opposed by high-powered banks and other large corporations that heavily rely on noncompete agreements to prevent top employees — from high-level executives to bankers and brokers — from taking clients and intellectual property with them to a competitor.