Competition Bureau Seeks End to Non-Compete Agreements
The federal agency is calling on provincial ministers to limit the use of restrictive employment contract clauses.
Updated on Oct. 29, 2026 in Employment
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Should the government restrict the use of non-compete agreements in employment contracts?
The Competition Bureau has urged provincial labour ministers across Canada to restrict non-compete agreements in employment contracts. The agency argues that these clauses limit job mobility, lower wages, and discourage entrepreneurship.
Why it matters
Reducing the prevalence of non-competes is intended to increase labour market competition and support economic growth. The Bureau claims that the current overuse of these agreements disproportionately affects workers who have no access to confidential company information.
A 2025 OECD survey found that 39 per cent of Canadian private-sector employees are covered by non-competes, while 30 per cent of firms apply them to every staff member. Additionally, up to 26 per cent of workers earning less than $3,000 per month are bound by these clauses.
The players
Competition Bureau
This independent law enforcement agency ensures that Canadian businesses and consumers prosper in a competitive and innovative marketplace.
The details
The Competition Bureau sent formal letters to labour ministers in 12 provinces and territories to advocate for legislative change. Many employers have begun using non-solicitation or non-disclosure agreements as alternative tools to protect business interests.
Timeline
December 2021: Ontario implemented a ban on most non-compete agreements.
2025: An OECD survey on employer use of non-compete clauses was conducted.
May 2026: Bill C-31 was tabled to ban non-competes in federally regulated workplaces.
October 29, 2026: The Competition Bureau issued letters to provincial labour ministers.
Macro View
The push by the Competition Bureau to limit non-competes extends the approach taken by Bill C-31 in the federal sector to the provincial level. This effort aims to align broader labour market practices across Canada with the recent legislative shift initiated in Ontario.
Workers currently bound by non-compete clauses may see increased job mobility and wage bargaining power if provinces adopt these new restrictions. Those earning under $3,000 per month stand to benefit most, as they are often improperly restricted by clauses despite lacking access to sensitive data.
The takeaway
Workers should review their current employment contracts to understand if they are bound by restrictive covenants that may no longer be necessary or enforceable. As legislative pressure mounts, employees may gain more flexibility to pursue career advancements within their respective industries.
What happens next
Bill C-31 is currently moving through parliament and will continue its legislative process to potentially ban non-compete agreements in federally regulated workplaces.
Further reading
For more on the national labour market, see Employment.
Live Poll
Should the government restrict the use of non-compete agreements in employment contracts?
