UK Prime Minister announces plans to curb non-compete clauses

Prime Minister Andy Burnham has announced plans to introduce legislation to curb the use of non-compete clauses in employment contracts, aiming to boost innovation and labor mobility in the United Kingdom.

Speaking at the Innovation Nation Summit in Manchester, Burnham stated that restrictive practices have “gone too far,” creating a “trap” for workers that prevents them from joining rivals or founding their own companies. He noted that these clauses often force employees to remain unpaid while unable to work, which acts as a “drag on innovation.”

The proposed changes are intended to support start-ups, scaling firms, and the “everyday economy.” Burnham compared the potential impact of the legislation to the “Bosman ruling,” a landmark legal decision that allowed professional footballers to move freely between clubs.

While the specific scope of the restrictions has not been detailed, the government is considering options such as a total ban, salary-based thresholds, or limits on clause duration. Details regarding the new legislation are expected to be unveiled alongside the Budget on October 28.