Companies’ rising use of non-compete clauses is dragging down productivity in rich economies, according to new research that found about a third of private sector employees restricted from joining a rival.
About 30 per cent of employers surveyed by the OECD said they had increased their use of the clauses in the past five years, with a fifth of employees “definitely” covered by the clauses and a further 10 per cent “probably” affected.
The OECD argues the clauses are economically damaging because they prevent workers moving to a new job or starting a new company where they might be more productive, as well as limiting their ability to bargain for higher wages.
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