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Study Suggests Non-Competes Disproportionally Stifle Opportunities for Women

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A recent article by Matt Marx, a business professor at Cornell University, suggests that non-competition agreements in the workplace disproportionately deter women from entrepreneurship. There is a substantial gender gap in those who start new businesses. Although there are a number of factors for that gap, the study finds that, in part, it is due to the possibility of litigation from such agreements. Non-competition agreements allow employers to enjoin their employees from leaving to start a rival business. The study points out that women as a whole tend to be more risk adverse compared to men. Thus, the mere risk of a lawsuit by a prior employer to enforce the contract disproportionality deters women from starting a competing business or venturing into more profitable areas or services for a new business.

The article is titled “Employee Non-compete Agreements, Gender, and Entrepreneurship” and was published in September 2021 in Organization Science.

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Cantrell Zwetsch is a litigation boutique that focuses its practice on non-compete and unfair competition disputes, employment law, and business disputes throughout Florida and Georgia, including the cities of St. Petersburg, Tampa, Clearwater, Orlando, Sarasota, Fort Myers, West Palm Beach, Miami, Fort Lauderdale, Jacksonville, Key West, Pensacola, Tallahassee, Gainesville, Savannah, Macon, Augusta, and Atlanta.

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