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Florida enacted legislation allowing non-competes of up to four years, handing a victory to Citadel’s Ken Griffin, who for the policy.

Labor lawyers say it’s one of the most employer-friendly policies in the country. It also goes in the opposite direction of many states, which have been trying to rein in or ban non-competes. The law’s supporters say it protects trade secrets and will help attract high-paying employers to Florida.

“Florida is poised to become one of the finance capitals of the world,” said Senator Tom Leek, one of the bill’s sponsors. “And if we want to attract those kinds of clean, high-paying jobs, we have to provide those businesses protection on the investment that they’re making and their employees.”

The bill became law without the signature of Governor Ron DeSantis under a rarely-used article in Florida’s constitution. If the governor fails to act on — or veto — a bill that’s been approved by the legislature, it becomes law within about two weeks.

Florida employers can now ask for four year non-competes and “garden leaves” — where employers continue to pay salaries and benefits. Employees though are mostly unable to re-enter the labor market. Employers also won’t have to pay bonuses, which can make up the majority of compensation at finance firms.

The law applies to employees making at least twice the county’s median wage, or typically more than $140,000 in Florida’s urban areas.

The bill also says courts should issue a preliminary injunction when an employer files a suit against a former employee, blocking the ex-employee from pursuing new work until the case is settled.

The policy change, which Griffin’s in Tallahassee helped shape, comes amid heated hiring wars at hedge funds. Firms lure talent with generous upfront bonuses and buyouts on deferred compensation, which in turn come with lengthy non-competes to keep them from defecting.

Citadel extended non-compete agreements for some portfolio managers to 21 months earlier this year.

A group of think tanks and academics had urged DeSantis to veto the bill, arguing that the policy stifles business

“There is an abundance of economic research demonstrating that the strict enforcement of non-compete agreements sharply reduces employee wages, the quality and quantity of new patents, and jobs created by new businesses,” according to a letter from groups led by the Center for American Entrepreneurship.

Photo: Griffen (Bloomberg)

Topics Florida