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Hedge funds and banks criticize UK plan to curb non-competes

TheCityUK said its members were very disappointed, warning changes could damage the competitiveness of the UK financial and professional services sectors.

Reported · Written up by our desk · Fund Industry

Hedge funds, investment banks, and other financial services groups have criticized UK government plans to restrict non-compete clauses in employment contracts, warning the move could harm competitiveness across the sector, according to a report by the Financial Times.

The proposal, backed by some technology groups, is intended to ensure non-compete provisions no longer prevent startups and growing companies from recruiting needed talent, the report said.

Financial firms that rely on non-compete agreements for roles including traders, portfolio managers, and dealmakers warned the changes could make it easier for senior employees to move immediately to competitors.

The report cited John Godfrey of TheCityUK, which represents major UK financial institutions, saying the organization’s members were very disappointed and that the proposed changes could damage the competitiveness of the UK’s financial and professional services industries.

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