While agreements that restrict employees from leaving a job and working for a competitor (commonly known as “non-compete” agreements) are standard in many industries, they are relatively scarce in the media and journalism sectors. Outside of television companies restricting star talent, and media companies restricting executives, it has rarely been common practice for journalists to be subject to non-compete restrictions. However, it appears that may be changing.
Citing the common reasons that are often put forth for non-compete clauses, two online based news companies founded in 2012 are now incorporating non-competes into their contracts. NowThis (a social news company that was co-founded by the executive chairman of BuzzFeed, a co-founder of the Huffington Post with Ariana Huffington) and the Independent Journal Review (an opinion and news website founded by former Republican staffers) have both made news in the last month for inserting broad non-compete clauses into new hire contracts.
The Independent Journal Review clause bars employees from working at “any competing business” “anywhere in the world” for six months prior to departure. Competing businesses are defined as any business that is involved in the practice of publishing news content. The NowThis clause appears to be a bit more narrow. It bars employees from working at a specified list of news media companies, including CNN, BuzzFeed, and Conde Nast.
Both of these companies may have trouble enforcing their non-compete provisions. In recent years, as companies invest more in their new hires, it has become common to try to use non-competes to prevent competitors from poaching employees and benefiting from that investment. There has been a corresponding rise in regulation and backlash on the part of those who believe this to be an unnecessary and even harmful tactic. For example, the state of California has banned the use of non-compete clauses in nearly all circumstances, and other states have seen judges increasingly refuse to enforce non-compete clauses. In the state of New York, the Attorney General’s office has even gone after media companies (e.g. Law360) for the use of non-compete clauses.
What Should Employers Do Now?
As this back and forth between employers and employees (frequently with the state on their side) continues to play out, it is best for employers to ensure that, if they include a non-compete clause in their standard contracts, that it is narrowly tailored in scope and geography to ensure that it is most likely to be enforced. As always, it is best to be cognizant of each applicable state law and craft employment agreements accordingly.