Ban non-compete clauses for most workers and cap the rest at three months

## Summary The government would stop employers enforcing non-compete clauses against workers earning under £60,000 a year, and would limit them to three months for higher earners. Workers could then move more freely to better-matched jobs or start rival firms, which should raise productivity and wage growth. ## Objective Non-compete clauses limit job mobility, weaken workers' bargaining power and slow the spread of skills and ideas between firms. The Department for Business and Trade (DBT) has estimated that around 5 million GB workers are covered, many in mid- and lower-paid roles where employers have little legitimate interest to protect. The main channel would be **productivity**: better job matching, faster knowledge diffusion and more new firms and spin-outs. A secondary channel would be **labour supply**, because people leaving a job would no longer have to sit out restricted periods. ## Measures 1. **Ban below the threshold.** Post-employment non-compete clauses would be unenforceable against any worker whose contractual annual basic salary at termination was below £60,000. For part-time workers this would be pro-rated to a full-time equivalent. The clause would be void, but the rest of the contract would remain valid. The ban would cover employees and "workers" as defined in the Employment Rights Act 1996, across England, Wales and Scotland. 2. **Three-month cap above the threshold.** For workers earning £60,000 or more, any non-compete would be enforceable for no longer than three months from termination. Any period of garden leave would count towards the three months (assumption). Longer clauses would be read down to three months rather than voided. 3. **Uprating (assumption).** The £60,000 threshold would be uprated each April from April 2029 in line with ONS average weekly earnings growth, rounded to the nearest £1,000. 4. **Protections retained.** Confidentiality, intellectual property and client and employee non-solicitation clauses would be unaffected, as would garden leave and notice provisions. 5. **Exemptions.** Non-competes agreed in connection with the sale of a business, or of a shareholding of at least 10% (assumption), would be exempt. 6. **Existing contracts.** Clauses agreed before 1 October 2027 would remain enforceable under current common law until 30 September 2028. After that date the new rules would apply in full. 7. **Enforcement.** Workers could seek a declaration of unenforceability from an employment tribunal, administered by HM Courts & Tribunals Service (HMCTS). Employers seeking injunctions would still use the High Court or Court of Session, which would apply the new limits. Acas would issue a statutory Code of Practice and guidance. Northern Ireland would not be covered, as employment law there is devolved. ## Timing and phasing | Period | Status | |---|---| | 2026-27 to mid-2027 | Royal Assent; Acas guidance published | | 1 October 2027 | Rules apply to all new contracts and new clauses | | 2027-28 | Partial year; affects new hires and renegotiated contracts only | | 1 October 2028 | Transition ends; all existing clauses are covered | | 2028-29 | First year in which the full stock of contracts is covered for half the year | | 2029-30 to 2032-33 | Full steady state; threshold uprated each April from 2029 | ## Cost and financing Direct Exchequer costs would arise only from administration: Acas guidance, DBT communications, and modest extra tribunal and court caseload at HMCTS. All figures are in cash terms and are additional to the March 2025 baseline. | £bn (cash) | 2027-28 | 2028-29 | 2029-30 | 2030-31 | 2031-32 | 2032-33 | |---|---|---|---|---|---|---| | Gross cost | 0.005 | 0.008 | 0.004 | 0.003 | 0.003 | 0.003 | These costs would be absorbed within the existing DBT and Ministry of Justice departmental expenditure limits. There would be no additional borrowing and no tax change. There would be no direct yield. ## Delivery **Legislation.** Primary legislation would be needed: a short Employment (Restrictive Covenants) Bill, or clauses in a DBT employment bill in the 2026-27 session. It would amend the Employment Rights Act 1996 and give the Secretary of State regulation-making powers to uprate the threshold. **Responsible bodies.** DBT would own the policy. Acas would handle guidance and conciliation, and HMCTS and the Ministry of Justice would cover tribunals and courts. **Main risks:** - Employers could substitute broader non-solicitation, confidentiality or long garden-leave and notice clauses, which would blunt the effect. - Salary engineering around the threshold. - Disputes over how "salary" is defined, for example the treatment of bonuses and equity. - Low awareness among lower-paid workers, so that void clauses still deter moves. - Tight parliamentary time before October 2027. - Divergence from Northern Ireland. ## Relation to the baseline The March 2025 OBR forecast contains no assumption on non-compete reform. The 2023 commitment to a three-month cap was never legislated. The forecast also made no specific adjustment for the then Employment Rights Bill's labour-market effects. The analyst should therefore treat the whole measure as additional to the baseline. Its trend productivity and labour-mobility effects should be phased in as follows: - partial effects from October 2027, covering new contracts only; - full coverage of the contract stock from October 2028. Any effects should be modelled separately from the Employment Rights Act measures.

The proposal would make post-employment non-compete clauses void for workers in Great Britain earning under £60,000 a year, and would cap them at three months for higher earners. The rules would apply to new contracts from October 2027 and to all existing contracts from October 2028. It changes no tax and adds no net spending, so it is modelled as a supply-side reform. Trend productivity per hour (TRPRODH) and trend output (TRGDP) are raised on a phased path, reaching +0.10% and +0.12% by 2032. Because these trend variables enter no behavioural equation and output is set exogenously in this version of the model, actual output (GDPM) is shocked on the same path as TRGDP. Equilibrium unemployment (NAIRU) is cut by 0.02pp, delivered in the model through a 0.02% rise in total hours worked (HWA), and a small transfer of bargaining power to workers is entered through the wage coefficient (ADJW). The business-investment response is imposed through total gross fixed capital formation (IF), about +0.095% by 2032, because the business investment equation is switched off. The fiscal gain comes entirely from receipts on the extra output, partly offset by triple-lock uprating of the state pension.

### Interpretation The proposal would make post-employment non-compete clauses void for any worker whose contractual basic salary at termination was below £60,000 a year. For part-timers this would be pro-rated to a full-time equivalent. For those earning more, clauses would be capped at three months, with any garden leave counting towards the three. The rules would cover employees and workers in England, Wales and Scotland. They would apply to new contracts from 1 October 2027 and to the whole stock of existing clauses from 1 October 2028, and the threshold would be uprated with average earnings from April 2029. The March 2025 baseline contains no non-compete reform, because the 2023 commitment to a three-month cap was never legislated, so the whole measure is treated as incremental. Its direct Exchequer cost would be only about £0.03bn of administration, absorbed within existing departmental budgets, and no tax would change. With no direct fiscal impulse, the proposal maps onto the supply side of the model. The main lever is trend productivity per hour (TRPRODH). It is raised on a phased path from +0.003% at end-2027 to +0.10% by end-2032, standing for better job matching, faster spread of skills and ideas, and more spin-outs. TRPRODH and trend output (TRGDP) enter no behavioural equation. In this version of the model gross domestic product at market prices (GDPM) is set exogenously, with the change in inventories (DINV) absorbing the expenditure residual. Actual output (GDPM) is therefore shocked on the same path as TRGDP, so the output gap (GAP) is unchanged. A small labour-supply effect, from leavers no longer sitting out restricted periods, is represented by cutting equilibrium unemployment (NAIRU) by 0.02 percentage points by 2031. NAIRU likewise enters no equation, so the effect is delivered by raising total hours worked (HWA) by 0.02%. The business investment equation is also switched off, so the investment response is imposed through total gross fixed capital formation (IF), raised by about 0.095% by end-2032. The shift in bargaining power, which would let covered workers capture part of the rent employers currently keep, is entered by raising the time-varying coefficient for wages and salaries (ADJW) by 0.04% by end-2030. All sizes are scaled well below the US evidence, for three reasons: - UK courts already refuse to enforce unreasonable clauses. - Employers could substitute non-solicitation, notice and garden-leave terms. - Northern Ireland, about 2.5% of UK employment, is excluded. ### How it works through the OBR model 1. **Voiding the clauses lets workers move to better-matched jobs, which raises productivity.** The lever is trend productivity per hour (TRPRODH). Actual productivity per hour (PRODH) is brought into step with it through the output and hours shocks described in step 2. Around 5 million GB workers hold a non-compete, about 3.5 million of them below the £60,000 threshold. The costing assumes their earnings would rise by about 1% in steady state, and by about 0.35% for higher earners whose clauses are capped. Two-thirds of that rise is treated as genuinely higher output, which gives a whole-economy productivity gain of about 0.12% in steady state and about 0.10% by end-2032. The gain builds slowly because it arrives only as people actually change jobs (roughly one in eight covered workers a year) and as firms founded by leavers grow. The first year covers new contracts only, and the full stock of contracts is covered only from October 2028. 2. **More productive hours lift output, with potential and actual output rising together.** The identity linking productivity to output is PRODH = GDPM / HWA. Output (GDPM) is therefore shocked by the productivity gain plus the small rise in total hours worked (HWA), reaching about +0.12% by 2032, so that PRODH tracks TRPRODH. All of the gain arises in market-sector gross value added (MSGVA), which rises by about 0.14%, because general government value added is tied to government consumption and does not change. Trend output is raised by the same amount, so the output gap (GAP = GDPM / TRGDP) does not move. This is extra capacity rather than extra demand pressing on capacity, so it carries no inflationary charge. 3. **Pay catches up with productivity over several years, helped by a small shift in bargaining power.** In the private sector average earnings (PSAVEI) equation, pay picks up 0.264 of any productivity gain immediately. It then closes the remaining gap with output per worker at about 4.3% a quarter, so about 70% of the productivity gain reaches pay by 2032. On top of this, the transfer of rents to workers who can now credibly threaten to leave enters through ADJW, rising to +0.04% from end-2030. Together with slightly higher employment, wages and salaries (WFP) would be about 0.13% higher by 2032, roughly £2bn a year. The intuition is simple: a worker who can walk to a rival can demand pay closer to their value, and employers who relied on the clause to hold pay down would have to match outside offers. 4. **Higher pay feeds into household income and, with a lag, into spending.** Extra wages flow into household disposable income (HHDI). After income tax, NICs and Universal Credit tapers take roughly a third, real household disposable income (RHHDI) would be about 0.09% higher by 2032, including mixed income and dividends that follow profits. The consumption (CONS) equation spends 0.103 of any income growth at once. It then closes about 12.5% of the gap with its long-run level each quarter. That long-run level carries an elasticity of 0.44 to income, supplemented by financial wealth because equity prices track nominal GDP. Consumption therefore rises by about 0.08% by 2032, a little less than income, so the saving ratio edges up slightly. Households tend to spend a lasting pay rise gradually, as they become confident it will last. 5. **Firms need more capital to equip a more productive workforce.** The desired capital stock (KSTAR) equation is KSTAR = exp(log MSGVA − 0.4 log COC + constant). With the user cost of capital (COC) unchanged, as here, desired capital rises one-for-one with market output. A 0.14% higher MSGVA therefore raises desired capital by about 0.14%. Investment must both replace depreciation, at 2.2% a quarter, and add to the stock, so business investment (IBUS) runs slightly ahead of output at about +0.17% by 2032. This figure is shaded down for evidence that incumbents that can no longer lock in staff invest a little less in training and firm-specific capital. Spin-outs and new entrants add some investment of their own. The business investment equation is switched off in this version of the model, so this path is imposed through IF, raised by about 0.095% by end-2032. IBUS then follows from the identity that subtracts government, public corporation and dwellings investment from IF. 6. **Shorter gaps between jobs add a little to employment, with no cyclical swing in unemployment.** Some workers would otherwise have sat out a restricted period or taken a stop-gap job outside their field; under the reform they could move straight into a relevant role. Equilibrium unemployment is cut by 0.02 percentage points by 2031, which means about 7,000 more people in work. In the model this comes through the HWA shock. Total LFS employment (ETLFS) equals 1000 × HWA / AVH, so with average weekly hours (AVH) unchanged a 0.02% rise in hours adds about 7,000 people. Output rises in line with potential, so the relationship that ties unemployment to the output gap (the Okun relationship) does not come into play. The market-sector employment (EMS) equation would normally shed hours when productivity rises, but here matching growth in demand offsets that. The unemployment rate (LFSUR) falls by about 0.02 percentage points by 2032. 7. **Prices barely move because supply and demand expand together.** Market-sector unit labour costs (ULCMS) measure pay per unit of market output. They dip slightly while productivity runs ahead of pay, then flatten as the bargaining effect pushes pay up. Feeding this through the services and retail cost indices into CPI leaves the consumer expenditure deflator (PCE) about 0.01% below baseline from 2029. A tighter labour market typically lifts wages and prices, which is the Phillips channel. With no change in the output gap, that channel stays essentially dormant. 8. **Monetary policy and gilt yields stay on the baseline path.** With inflation essentially unaffected, Bank Rate (R) is held on its baseline path. Public sector net debt (PSND) would be about £3.7bn lower by 2032, about 0.2% of GDP. On standard estimates of 2-4bp per 1pp of debt, that is worth well under one basis point on the 20-year gilt yield (RL). Trend growth about 0.02pp a year faster could nudge the neutral rate up by a similarly trivial amount, so RL is left unchanged. ### Key assumptions - **Coverage:** About 5 million GB workers hold a non-compete (DBT estimate). About 3.5 million earning under £60,000 would have their clauses voided. About 1.5 million above the threshold would see clauses cut from typically six months or more to three. - **Earnings effect on covered workers:** +1.0% in steady state below the threshold and +0.35% for capped higher earners, with about 85% realised by 2032. This compares with 2-4% found where US states moved to non-enforcement (Oregon's low-wage ban, Hawaii's tech ban and cross-state studies). - **Productivity versus rent transfer:** Two-thirds of the covered-worker earnings gain is treated as genuine productivity (better matches, diffusion of ideas, new entry). One-third is treated as a transfer of rents from employers, entered through ADJW. - **Substitution and awareness taper:** About 40% of the gross US-based effect is assumed to be lost. The causes would be broader non-solicitation clauses, longer notice and garden leave, forfeiture-for-competition terms in bonus and share schemes, salary engineering around £60,000, and low awareness among lower-paid workers that their clauses are void. - **Aggregate productivity path:** TRPRODH +0.02% at end-2028, +0.04% in 2029, +0.065% in 2030, +0.085% in 2031 and +0.10% in 2032, approaching about 0.12% after the horizon. The profile follows the pace of job-to-job moves after full coverage in October 2028. GDPM is shocked on the TRGDP path (+0.12% by end-2032), so that actual and potential output move together. - **Incumbent investment offset:** A small deduction, about 0.02% of output in steady state, is already netted off. It reflects weaker incentives to train staff and invest in firm-specific know-how when staff are easier to poach. - **Labour supply:** NAIRU −0.01pp from 2029 and −0.02pp from 2031, delivered in the model by raising HWA by 0.01% and 0.02% on the same dates, giving about 7,000 more people in work by 2032. - **Wage pass-through:** As coded in the PSAVEI equation, with 0.264 immediate response to productivity growth and 4.3% a quarter error-correction, so about 70% of the productivity gain reaches pay by 2032. - **Investment block:** KSTAR has an elasticity of 1 to MSGVA and −0.4 to COC, with COC unchanged by the policy. Capital depreciates at 2.2% a quarter. The IBUSX equation is switched off, so the IBUS path is imposed through IF (about +0.095% by end-2032). - **Monetary-policy reaction:** Bank Rate (R) stays on the baseline path, and the 20-year gilt yield (RL) is unchanged because the debt and trend-growth effects are each below 1bp. - **Baseline and roll-forward:** The March 2025 EFO is used to early 2030 and then carried forward at about 1.7% real growth and about 2% CPI. On that basis, nominal GDP is about £3.45tn in 2030 and £3.75tn in 2032, wages and salaries about £1.55tn in 2032, and state pension spending about £200bn. PSND is about £3.6tn, or about 96% of GDP, at end-2032. - **Fiscal conversion:** Receipts are taken at about 38% of extra nominal GDP, with collection lags, plus a composition uplift because wages take about 60% of the gain. The triple lock is assumed to uprate by earnings from 2029, and the admin costs are absorbed in departmental budgets. The in-model links are comparatively firm. These are the wage equation's pass-through of productivity, the one-for-one response of desired capital to output, and the consumption function, and they mostly determine the shape of the profile rather than its size. The size rests almost entirely on inputs from outside the OBR model. The first is the earnings and productivity effect of weakening non-competes, taken from US state reforms in a system where clauses were more enforceable than UK courts allow. The others are the 40% taper for substitution and low awareness, and the two-thirds split between productivity and rent transfer. If UK clauses already bind weakly, or employers move wholesale to non-solicitation and forfeiture clauses, the productivity gain could be half the central estimate: about 0.06% of GDP by 2032, with a fiscal gain of about £1.8bn rather than £3.7bn. If the chilling effect on lower-paid workers is as large as US evidence suggests, the gain could be about 1.5 times larger. The fiscal result scales almost linearly with the productivity assumption. Each extra 0.01% of potential output by 2032 is worth about £0.3bn of cumulative borrowing. The split between productivity and rent transfer matters less for GDP than for distribution, because it shifts gains between workers and firm owners. The monetary-policy assumption is unimportant here because there is no demand shock. The counterfactual would matter only if a separate three-month cap were legislated in the meantime. In that case the incremental effect for higher earners would fall to zero and the overall effect would shrink by roughly a fifth. ### Headline results Output (GDPM) would be essentially unchanged in 2027, when the rules would reach only new contracts signed in the final quarter. It would be about 0.02% above baseline at the end of 2028, as the transition ends. The gain then builds steadily, to about 0.05% in 2029, 0.08% in 2030 and 0.12% by end-2032, as each year's job moves, spin-outs and spread of know-how add to the stock of better matches. The profile is back-loaded and still rising at the end of the horizon, with a little more to come afterwards (about 0.12-0.13% in steady state). Business investment (IBUS) responds most in proportional terms, reaching about 0.17% above baseline by 2032, as firms build capital to keep pace with higher market-sector output. Consumption (CONS) follows pay with a lag and reaches about 0.08%. That is a touch below output, because the model's consumption function spends less than all of an income gain over the medium term. The unemployment rate (LFSUR) would be about 0.02 percentage points lower by 2031-32, entirely because workers move between jobs faster. The consumer expenditure deflator (PCE) would be about 0.01% lower from 2029, a rounding error reflecting the brief lag of pay behind productivity. The 20-year gilt yield (RL) would be unchanged. This is a small, slow-building, supply-side gain with no meaningful demand or inflation side effects. Its size rests far more on the external evidence about non-compete clauses than on the model's own coefficients.

### Costing the policy - **Gross static cost (mechanical spending increase):** +£0.03bn added to public sector net borrowing (PSNB) over the horizon. This covers the Acas Code of Practice and guidance, DBT communications and a modest extra caseload at employment tribunals and the courts. Costs would peak at about £8m in 2028-29 as the transition ends, then settle at about £3m a year. - **Absorbed within existing DBT and Ministry of Justice budgets:** −£0.03bn. Departmental expenditure limits are fixed in cash in the baseline, so meeting the costs within them would leave total spending and borrowing unchanged. Tribunals and Acas are GB-wide reserved functions and no new England-only spending arises, so there would be no Barnett consequentials. - **Supply-side receipts feedback (higher potential output):** −£3.6bn. Higher productivity and slightly more hours would raise nominal GDP by about £10bn in total over 2027-2032, including about £3.75bn in 2032 alone (0.11% of baseline GDP). At a tax take of about 38%, and after collection lags on self-assessment and corporation tax, this would recover about £3.6bn. - **Tax-base composition (income shifts towards wages):** −£0.2bn. Because of the bargaining transfer, pay would take about 60% of the extra output rather than the usual 50%. Labour income bears about 47% in income tax, NICs and VAT on spending, against about 30% on profits, which adds about £0.07bn a year by 2032. - **Spending feedback (triple-lock uprating on higher earnings):** +£0.35bn. Earnings are assumed to be the binding element of the triple lock in the rolled-forward baseline. Average earnings about 0.1% higher would then feed into state pension uprating from April 2030, costing about £0.17bn in 2032 on a bill of about £200bn. - **Debt-interest saving (lower debt):** −£0.25bn. Debt would be on average about £3bn lower during 2032, and at an effective interest rate of about 4%, with gilt yields unchanged, servicing costs fall by about £0.13bn that year. - **Net cumulative PSNB change:** −£3.7bn. This is the sum of the rows above. Borrowing would be about £1.4bn a year lower by 2032, about 0.04% of GDP, and still rising as the productivity gain matures. ### Debt path Public sector net debt (PSND) would be about £3.7bn lower by end-2032. That matches the cumulative fall in borrowing, because the measure involves no loans or other financial transactions. Baseline PSND is about £3.6tn, about 96% of a nominal GDP of £3.75tn in 2032. The lower debt numerator alone would cut the ratio by about 0.10 percentage points (3.7 ÷ 3,750). A higher denominator would cut it by a further 0.11 points, because nominal GDP would be about 0.11% higher (0.12% real output less 0.01% on prices), and 96% × 0.11% ≈ 0.11pp. The ratio would therefore be about 0.20 percentage points lower in total. On the OBR's standard assumptions the measure would not cost the Exchequer anything and would modestly strengthen the public finances. That conclusion rests wholly on a judgement about productivity: if the OBR declined to score those effects, the measure would be fiscally neutral rather than leaving any hole.

### Overall pattern By 2032, households would gain about £1.3bn a year, net of tax and benefit tapers, from higher pay and slightly higher employment. About £0.15bn of lost profits for owner-managers would offset part of this, leaving a net direct gain of about £1.2bn, or about £40 per household on average. Businesses as a whole would not be clear losers. Incumbent employers would hand about £0.6bn a year of retention rents to workers, but the productivity gain would raise profits for firms that hire movers and for new entrants. In cash terms, gains would rise with income because covered and higher-earning workers are concentrated in the middle and upper deciles. As a share of income, gains would peak in the middle (about 0.13% in decile 5) and be smallest for the poorest and richest tenths, so the pattern is mixed, or hump-shaped. Borrowing would also be about £1.4bn a year lower by 2032, worth about £50 per household in reduced future tax or spending restraint. Counting that, the average household would be a modest net winner, but owners of small firms that rely on non-competes would remain net losers. ### Who gains - **Workers earning under £60,000 with a non-compete clause:** about £200 a year each, 0.67% of net income. Their clauses would be void. Those who move to better-matched jobs could gain several per cent, while those who stay would benefit from stronger outside options at pay reviews, averaging about 0.8% on a £37,000 salary before tax and tapers. - **Workers earning £60,000 or more with a non-compete clause:** about £175 a year each, 0.26% of net income. Restrictions would be cut from typically six months or more to three, a smaller change than an outright ban. The gain is also taxed at higher rates, so it is smaller as a share of income. - **Workers who start rival firms or spin-outs:** about 12,000 extra new businesses by 2032, not valued in £. Leavers could set up in competition straight away rather than waiting out a restriction. The returns would vary widely, from small trades businesses to venture-backed spin-outs. - **People who move into work sooner after leaving a job:** about 7,000 more people in work at any one time by 2032, not valued in £. Leavers who would otherwise have sat out a restricted period or taken a stop-gap job could move straight into a relevant role. For each of them the gain is far larger than the average for covered workers, because time out of work is replaced by a full wage, although part of it is withdrawn through Universal Credit. ### Who loses - **Owners of small firms that rely on non-competes:** about −£600 a year per household, −0.92% of income. Owner-managers of recruitment agencies, salons, estate agents, IT consultancies and similar firms would have to pay more to keep key staff and could lose some clients to departing employees. The loss is concentrated on about 250,000 households, mostly in the top three deciles. ### Paying for it and bond markets - **Future taxpayers:** about +£50 a year per household, 0.11% of income. Borrowing would be about £1.41bn a year lower in 2032. Divided across about 29 million households, that is about £49 per household, rounded to £50. This is an ongoing annual amount that keeps growing slightly, not a one-off or a total over the horizon. - **Future taxpayers (lower debt):** about £130 per household, one-off. Public sector net debt (PSND) would be about £3.7bn lower by end-2032, and £3.7bn divided across about 29 million households is about £130. Future taxpayers would not have to service or repay this debt. Under the fiscal rules the lower borrowing would be banked, or eventually returned through lower taxes or more spending; if returned through broad-based tax cuts, higher-income households would gain more in £. Because borrowing falls, there are no hidden financing losers, although the gain depends on the productivity judgement holding. - **Mortgage borrowers:** £0 a year, 0.00% of income. The 20-year gilt yield (RL) would be unchanged, moving by well under 1bp, so nothing would pass through to mortgage rates. The bond-market effect is negligible. ### Across the income distribution In cash terms, gains would rise from about £10 a year in the poorest tenth to about £65 in the richest. Few households at the bottom have a worker on a non-compete, and many are pensioners or out of work. Lower-middle and middle deciles contain most of the 3.5 million covered workers earning under £60,000. Gains as a share of income would peak at about 0.12-0.13% in deciles 3 to 5. In the top tenth they would fall to about 0.05%: higher earners receive only the three-month cap, and the owner-manager losses are concentrated there. The averages hide much larger effects for particular groups. A low-paid hairdresser, care coordinator, security guard or recruitment consultant whose clause currently stops them working nearby could gain several hundred pounds a year by moving, closer to 1-2% of their income. Owner-managers in deciles 8 to 10 who rely on such clauses would lose noticeably more than the small net figures for those deciles suggest. ### Caveats The figures rest most on three judgements. The first is how much non-competes currently hold down UK pay, which is scaled down from US evidence. The second is the split between productivity gains and transfers of rent from employers. The third is the assumption that incumbent losses fall mainly on owner-managers, with listed shareholders broadly compensated by higher profits elsewhere. These are first-round effects of the reform on pay, employment and profits; the small second-round effects on prices and interest rates shown in the macro table are excluded. Effects within groups vary widely, because workers who actually move gain far more than those who stay. The sizing draws on DBT's estimate of non-compete coverage, ASHE and HMRC income distributions, the ONS Effects of Taxes and Benefits analysis for decile incomes, and US studies of state non-compete reforms.