Burnham to end non-compete clauses holding back tech workers
Key Points
- Andy Burnham will legislate against non-compete clauses in the UK.
- The change targets hiring barriers at start-ups and scaling firms.
- Burnham called it a Bosman ruling for the innovation sector.
- Final rules on bans, time limits or salary thresholds await consultation.
- Startup Coalition welcomed the move, while TheCityUK previously opposed a ban.
Prime Minister Andy Burnham will legislate to stop non-compete clauses blocking hiring at UK start-ups.
Burnham made the commitment in a speech on Friday (9 October), targeting contract terms that stop employees joining rivals after they leave.
“I believe some businesses have gone too far in their use of restrictive practices such as non-compete clauses, a view I know shared by many in this room and across the sector,” said Burnham.
Non-compete clauses bar workers from joining a competitor or launching their own rival business for a set period after leaving a job.
“Non-compete clauses stop workers from joining a rival organisation, or indeed, setting up one of their own after they have left their role, and I think that’s a drag on innovation and prevents the best really being energised and bringing that dynamism to the economy,” said Burnham.
“They are often held back and unpaid during the time they have to sit out on the sidelines, and it does, as I say, stunt innovation and traps workers,” he added.
“So I can confirm today we will legislate to make sure that non-compete clauses will no longer be a barrier to hiring for our most promising start-ups and scaling firms,” said Burnham.
Burnham compared the change to the Bosman ruling, the 1995 European Court of Justice case that let out-of-contract footballers move freely between clubs.
“Call it, if you like, the Bosman ruling for the innovation sector, but I think it’s needed and long overdue,” he said.
The commitment also extends beyond tech to workers in lower-paid, everyday jobs.
“And we will ensure, by the way, that workers in the foundational economy, the everyday economy, are not prevented from moving jobs too,” said Burnham.
The announcement follows a September letter from more than 20 UK tech founders and investors, including people linked to ElevenLabs and Synthesia.
The group urged the government to curb non-competes, long notice periods and gardening leave, arguing these slow hiring compared with US rivals.
The final rules will follow a consultation and could take the form of an outright ban, time limits or salary thresholds.
Keir Starmer’s government previously consulted on reform options, with that consultation closing in February 2026.
Dom Hallas, chief executive of Startup Coalition, welcomed the announcement and said mobile talent helps start-ups grow, pointing to Silicon Valley’s free-flowing workforce as the model.
Lobby group TheCityUK previously opposed a ban, arguing that non-competes help firms protect confidential information and intellectual property in high-value sectors.
