State Politics

Business leaders, Boise lawmaker say Idaho non-compete law went too far

State Rep. Ilana Rubel, D-Boise, and business leaders Tuesday at the Idaho Capitol.
State Rep. Ilana Rubel, D-Boise, and business leaders Tuesday at the Idaho Capitol. Boise State Public Radio

More than 100 businesses have signed a letter in support of changing Idaho’s non-compete law after it was amended less than a year ago, saying it went too far.

After Idaho legislators tweaked the law in 2016, workers who sign a non-compete contract have to prove they’re not harming their employers if they want to go work for someone else.

That’s drawn criticism from those in the tech startup world and certain lawmakers like state Rep. Ilana Rubel, D-Boise.

“Employers really don’t have to prove anything. They don’t have to prove they’re harmed in any way. They just win. It just ostensibly stacked the deck against employees to a really strange degree,” Rubel says.

She and a handful of business leaders and investors delivered the letter to Gov. Butch Otter Tuesday morning and held a press conference in the Capitol rotunda.

Milt Gillespie, president of Mariposa Labs in Garden City, is one of them, along with heavy hitters like the co-founders of Micron.

Gillespie’s company manufactures and develops skincare products for companies around the world. He says non-compete contracts simply lower employee morale.

“You can’t get people to perform really well by locking them in their office. It’s just a bad idea from a business perspective, in my opinion,” Gillespie says.

Supporters of the new law reject any argument that it’s stifling the economy or creativity.

“These are optional, so companies don’t have to use them if they don’t want to use them,” says Alex LaBeau, president of the Idaho Association of Commerce and Industry.

He notes that these agreements typically only affect high-ranking employees. LaBeau also points out someone could get a job at a company that’s not a competitor with their previous workplace and it wouldn’t violate his or her contract.

“You have to take those things into consideration before everybody gets too wound up about that this is hurting employment because we don’t see that.”

Still, Rubel, a lawyer outside of her duties as a state legislator, says the simple existence of a non-compete agreement hanging over an employee’s head could deter him or her from switching jobs just to avoid a lawsuit.

“Most people may just choose to not go for that better job, not start that new company, rather than find themselves embroiled in years of extremely expensive litigation,” she says. “We can’t afford to shackle talent.”

Rubel has drafted a bill to change the law, but details are still being worked out.

Find news director James Dawson on Twitter @RadioDawson

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