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Georgians Pass Amendment Endorsing Non-Compete Changes

We noted in a previous blog post (October 4) the angst and passions kindled in many Georgia residents when the topic of non-compete agreements comes up. Georgia has long been among only a handful of states with law that voids an entire non-compete agreement if any aspect of it is deemed illegal. Most states, by contrast, enable a judge to strike a specific provision if it is found to be against public policy and uphold the remainder of a contract executed between an employer and worker.

Many Georgia politicians and business groups have long favored change, saying that it is necessary to make the state more competitive economically with other states; ascribing to the majority view, they note, will help businesses better protect their intellectual property.

Foes of change have said that making the law more employer-friendly will destroy a necessary balance that allows for workers to reasonably leave their jobs and find new ones.

State voters have largely put the debate to rest, having just passed on November 2 a state constitutional amendment that will now allow judges to modify or sever any provision in a non-compete agreement that they think is overly broad, without the entire agreement being deemed unenforceable. The amendment will apply only to restrictive covenants executed after November 2.

Amendment sponsors and advocates are ecstatic, stating that Georgia will no longer be viewed as unfriendly toward commerce by businesses contemplating an in-state presence.

Opponents, though, think otherwise. "Many states that do not enforce restrictive covenants are still doing well in attracting business," says retired Georgia Supreme Court Chief Justice Norman Fletcher, who has long opposed a change. He adds that, "This amounts to placing employees in some kind of condition of servitude, because they can't get out of it unless they move hundreds of miles away."

Related Resource: "Georgians say no to trauma care, yes to non-compete clauses" November 2, 2010

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