Workers will no longer be held back by non-compete bans: one of the world's largest investment companies changes the rules
Imagine: you have found a more interesting or better-paying job, but you can't accept the offer because the new employer is considered a competitor of your current one. For some American employees of companies owned by KKR, this barrier is now disappearing.
Investment company KKR, one of the largest in the world, has decided to drop such restrictions for employees of its American companies with annual earnings of less than $100,000.
Moreover, the change applies not only to future employment contracts. KKR companies also must not enforce already signed non-compete agreements against workers in this category.
How can a worker be banned from being hired by a competitor at all
This concerns so-called non-compete agreements.
Such a clause in an employment contract can prohibit a person after leaving from joining a direct competitor or starting their own business in the same field.
The restriction usually lasts for a certain period and may apply to a specific territory or type of activity.
In practice, a person may receive a more advantageous offer precisely because they know their industry well—but find themselves bound by an agreement with their former employer.
For employees of KKR companies in the US who earn less than $100,000 a year, such restrictions should no longer apply.
Importantly, existing bans are also being lifted
KKR could have simply stopped including such conditions in new contracts. But the company went further.
According to Pete Stavros, co-head of KKR's private equity business, US portfolio companies should no longer enter into new non-compete agreements with employees earning less than $100,000, nor enforce existing ones.
This means the change also affects people who signed such a document earlier.
For them, the circle of potential employers becomes wider: accumulated professional experience can be used at another company in the same industry, without facing exactly the ban on moving to a competitor.
Why KKR's decision matters beyond one company
KKR is not an ordinary employer with a few thousand employees.
It is one of the world's largest investment companies. It invests money in a large number of enterprises from a wide range of industries and may own a significant stake or control them.
Such enterprises are called portfolio companies.
Therefore, the new rule applies not only to KKR's own staff, but to employees of US companies owned by the investment group.
It is precisely the scale that makes the decision significant: a major business owner is effectively testing in practice whether employees can be retained through pay, conditions, and career opportunities instead of a legal ban on leaving for competitors.
Why employers introduce such restrictions in the first place
Companies have a clear argument.
An employee may have access to trade secrets, internal pricing, development plans, client base, or technologies. After the employee moves, a competitor potentially could gain an advantage.
But non-compete agreements are used not only for top management or specialists who hold critically important information.
They can also apply to ordinary workers.
In that case, the restriction affects not so much the protection of corporate secrets as the person's ability to find their next job in their field.
A ban can also affect wages
The most valuable vacancy for an experienced specialist is often precisely at a competitor: they need the same skills, industry knowledge, and professional contacts.
If such a move is prohibited, a person has to choose from fewer offers, change fields, wait for the restriction to expire, or turn down a more advantageous job.
The fewer potential employers that can compete for an employee, the weaker that employee's position in wage negotiations.
That is why non-compete agreements in the US have for several years been debated not only among lawyers, but also around broader issues—worker mobility, wages, and competition for talent.
A nationwide ban in the US never came into effect
The US Federal Trade Commission (FTC) previously tried to ban non-compete agreements almost entirely at the federal level.
However, the rule was blocked by a federal court and is currently not in effect.
Therefore, there is no uniform ban for all American workers. The ability to use such agreements depends in part on the laws of a particular state and the circumstances of the employment relationship.
Yet the FTC continues to review individual cases. In 2026, the regulator, for example, secured the elimination of non-compete agreements for more than 18,000 workers of one of the largest American pest control companies.
Why KKR settled on the $100,000 threshold
For now, the new rule applies primarily to low- and middle-income employees.
For executives and highly paid specialists, companies more often use restrictions because such employees may have access to strategy, client data, and other sensitive information.
But the current threshold will not necessarily remain permanent.
According to Stavros, KKR expects over time to extend the elimination of non-compete agreements to employees earning more than $100,000.
The main change for a worker—the ability not to start a career from scratch
For an ordinary employee, the meaning of the decision is quite simple.
If a person has worked for several years in technology, manufacturing, healthcare, or another industry, it is often competing companies that offer the most suitable vacancies.
A ban on such a move can force them to forgo a pay raise, change specialties, or wait until the contractual period expires.
KKR is now refusing to use this tool for some workers at its US portfolio companies.
And if this model proves viable and other large business owners begin to replicate it, companies will have to compete for employees not with post-employment restrictions, but with conditions that make people want to stay.
Sources: Bloomberg Law, Federal Trade Commission, KKR.