UK non-compete rules reform faces fresh pressure from tech leaders
The UK has yet to choose a non-compete reform model as researchers and founders push ministers to loosen restrictions on talent moves.
By Marcus Adeyemi · Startups Editor
· 3 min read
UK non-compete rules reform remains unresolved after researchers, founders and investors renewed calls for ministers to loosen restrictions that can delay employees joining competitors or starting companies. The government has consulted on several models but has not decided whether, or how, to proceed, according to Sifted.
The immediate pressure is coming from technology figures seeking a change that would make garden leave optional for employees. That proposal is separate from the formal options in the government’s consultation, which concern non-compete clauses in employment contracts.
No bill, final policy choice or timetable has been announced. For startups, the distinction matters: the current debate is about prospective labour-market policy, not a rule change companies can yet apply to recruiting or employment contracts.
What options are being considered for UK non-compete rules reform?
The Department for Business and Trade issued a working paper on 26 November 2025, requesting responses by 18 February 2026. It sought views before the government determines which, if any, proposals to take forward.
The paper listed four broad routes:
- a statutory cap on the duration of non-compete clauses;
- a ban on non-competes in employment contracts;
- a ban for workers below a salary threshold; and
- a combined salary-threshold ban and statutory time limit.
The government presented the exercise as part of its growth agenda and said it was seeking a more dynamic labour market. Its paper says the review is intended to gather stakeholder input, rather than commit the government to one approach.
A three-month statutory cap has already had one political life. The previous government announced that approach in 2023, but it did not legislate before the 2024 general election, according to Sifted and White & Case.
Why are technology leaders pushing now?
Nando de Freitas, a London-based AI researcher who previously worked at Google DeepMind, argued on X that lengthy garden-leave terms make it harder for researchers to form companies and recruit teams. Ian Hogarth, a partner at Plural and chair of the government’s AI Safety Institute, supported the call for a policy that he described as favourable to workers and startups.
Other advocates have made similar claims about hiring friction. Jarad Cannon, chief technology officer of robotics startup Humanoid, said hiring in the UK can take up to six times longer, while Evantic founder Matt Miller argued that founders look outside the UK because they cannot hire the people they need quickly enough. Those are industry views, not government findings.
Non-competes restrict a departing worker from joining a rival or forming a competing business for a defined period. The government’s review puts the policy question squarely on worker mobility and company formation, but its final choice could range from a targeted limit to an outright ban. Until ministers choose a model and set an implementation path, employers and candidates have no new statutory rule to act on.
This story draws on original reporting from Sifted.
