March 24, 2015
The measure, Senate Bill 69, would tighten non-compete clauses in employee contracts. Non-compete clauses prohibit employees from competing against their employer while they are employed or for a period after they leave the job or are fired. These clauses bar them from taking a job or starting a business that competes with their ex-employer. Non-compete clauses are meant to protect an employers’ confidential information, client lists or trade secrets from being unfairly used to compete against them by former employees. However, overly broad non-compete clauses can make it difficult or nearly impossible for employees to find work in their profession.
Wisconsin’s restrictive covenant law allows non-compete clauses, but the entire clause may be struck down in court if a judge finds any part of the clause unreasonably restricts a person’s ability to get a job.
The legislative proposal, which was sponsored by Senator Paul Farrow of Pewaukee and Rep. Mike Rohrkaste of Neenah, would replace current Wisconsin law with provisions more favorable to a job seeker's former employer. The bill would prevent a court from striking down entire non-complete clauses because of one overly broad provision. Instead, a judge would be required to revise the unfair portion of the non-compete clause, and then enforce the clause.
The measure also prohibits judges from ruling against employers using narrow interpretations of non-compete clauses or from considering economic or personal hardships suffered by subjects of the clauses.
The proposal is supported by Wisconsin Manufacturers & Commerce, which is the state’s largest business organization and an influential player in state policymaking, spending and elections. The group boasts about 3,500 members who span a dozen special interests, including business, construction, manufacturing, tourism, energy, transportation, insurance and agriculture. Those special interests contributed nearly $85,000 to Farrow and nearly $22,000 to Rohrkaste between January, 2013 and Oct. 20, 2014, which was most of the money they raised to win their November elections.
Farrow’s top contributors were David and Donna Clark, of Waukesha, owners of ClarCorp Industrial Sales; George and Susan Mitchell, of Whitefish Bay, consultants for School Choice Wisconsin; and Pete Farrow, a Group Health Cooperative executive, and his wife, Michelle, a Chippewa Falls Chamber of Commerce coordinator. Each couple contributed $2,000 to the senator.
Five couples who gave Rohrkaste a $1,000 each were his top contributors: David Sagehorn, an Oshkosh Corp. executive, and his wife, Katherine, of Neenah; Bryon Blankfield, an Oshkosh Corp. attorney, and his wife, Rebecca, an Ellipse Fitness director, of Neenah; Marek May, an Oshkosh Corp. executive, and his wife, Laura, of Neenah; David Rust, a management consultant, and his wife, Nikki, of Appleton; and Norman Fox, a Kimberly Clark Corp. director, and his wife, Karen, of Appleton.