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Greenfield Should Try Again with Kloucek’s Restrictions on Non-Compete Clauses

Not found in my Christmas stocking: new bills! Some years the Legislature gets on the stick and pops some bills into the hopper around Christmastime so avid bloggers can get a jump on analyzing the early entries before the New Year and the Session (which opens for nine fun-filled four-day weeks on January 14). But as of breakfast-time today, the 2020 hopper remains empty.

One bill which we can hope comes back is 2019 Senate Bill 120, Senator Brock Greenfield‘s (R-2/Clark) really good idea to chop the limit on non-compete clauses from two years to one. The Senate President Pro-Tem borrowed this bill from his former colleague Frank Kloucek, who put the same halving of non-compete clauses forward in 2012 House Bill 1004, which then Rep. Greenfield voted to kill in committee. If Senator Greenfield can change his mind, so can Al Novstrup, Bob Ewing, Craig Kennedy, Kris Langer, Jeff Monroe, VJ Smith, Jordan Youngberg, and other anti-capitalism Senators who contributed to SB 120’s narrow defeat in the Senate last year.

Greenfield could take Kloucek’s idea further. He could follow Maine, which enacted this year a number of pro-worker reforms restricting non-compete clauses:

  1. Employers can impose non-compete clauses only on workers making more than 400% of the federal poverty level. Right now, that means Maine workers making $49,960 or less are free to leave their jobs and seek better-paying positions in their field.
  2. Non-compete clauses don’t take effect until six months after an employee signs a non-compete agreement or one year after the employee starts work, whichever is later. As attorney Adam Nyhan explains it, Maine’s law gives employees a one-year grace period during which to decide if employers demanding a non-compete clause is a good fit and, if their current jobs aren’t a good fit, gives them incentive to leave quickly, making capitalism work better for everyone.
  3. Employers violating the new rules face at least a $5,000 fine from the state Department of Labor.

Other states are reining in non-compete clauses. Maryland and New Hampshire have set lower income limits. Rhode Island has set the income limit at 250% of the federal poverty level ($31,225) but also protects non-exempt employees, college, students, and teen workers from non-compete clauses. The state of Washington has forbidden non-compete clauses against employees getting annual pay and benefits worth less than $100K and independent contractors earning less than $250K.

Employers secure employees’ sacrifice of their liberty by compensating them. When the compensation stops, so does the sacrifice. Workers should be free to work where and when they want, freely for themselves or for fair wages from anyone willing to hire them. Those are fair rules of capitalism; Kloucek and Greenfield both properly recognize that non-compete clauses violate those fair rules. Senator Greenfield, hurry up and throw your pro-capitalist restrictions on non-compete clauses back in the hopper!


  1. grudznick 2019-12-26 17:14

    Please don’t associate Mr. Greenfield with anything related to Mr. Kloucek, the least effective in the legislatures, ever. You hurt our cause when you do so. Don’t block The Brock

  2. Debbo 2019-12-26 17:15

    Good idea! It was a good idea when Kloucek had it, but now that it’s coming from Greenie, SDGOP pledge signers can vote for it. 🙄🙄

  3. Frank Kloucek 2019-12-26 18:36

    Please do not associate anything Grudznik posts on this or any other site as the truth. In fact Grudz is a “truth slayer”. The hypocrisy of some in the SD GOP wanting free and open capitalism in their platform is stifled by a monopolistic “me first” attitude by not wanting to go from 2 years to 1 year in non compete clauses. Happy New Year to each and every one of you.

  4. leslie 2019-12-26 19:25

    grdz is a complete fraud. Frank is a good Dem from Scotland where my relatives farmed/ranched.

  5. Debbo 2019-12-26 20:05

    What Leslie said, except that I don’t have any relatives in the Scotland area.

  6. Cory Allen Heidelberger Post author | 2019-12-26 21:53

    Non-compete clauses run counter to South Dakota’s loudly proclaimed right-to-work status. Oh yeah, I keep forgetting, “right to work” doesn’t mean what it says, either.

  7. grudznick 2019-12-27 17:08

    Happy New Year, Mr. Kloucek. Bring more kolaches this year and put more stuffing into them. Those dry ones don’t really satisfy the empty bellies of those working hard to pass real law bills.

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