John Siegal Comments on Proposed NY Bills That Would Void No-Poach Agreements

News / April 20, 2021

Partner John Siegal is quoted in an article published by Law360 on April 20, 2021. The article, “NY Bills Would Curb No-Poach and No-Rehire Pacts,” reports on two bills under consideration in New York State that would void no-poach and no-rehire agreements. No-poach agreements are often found as covenants in franchise contracts, restricting the recruitment and hiring of employees from other units within the same franchise.

Siegal, who chairs the New York City Bar Association’s trade secrets committee, told Law360 that Bill S562 might “cut too broadly” because it does not include time limits or differentiate between low-level workers and those in management positions.

“Under this legislation, somebody could go to work for a franchisee, get their training, and the next month, jump to another franchisee of the same chain. The original franchise operator would be out the time and money spent training that person," Siegal said.

He also noted that franchise operators, in particular in the food and hospitality industry, offer entrepreneurial opportunities to people from immigrant backgrounds and minorities.

“I'm not sure that this legislation fully appreciates their role and their risks,” he said.

Read the article (registration required).

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