Canada’s Competition Bureau Calls for Tighter Limits on Non-Compete Clauses

Canada’s Competition Bureau is calling for tighter restrictions on non-compete clauses, warning that millions of workers may be missing out on better jobs, higher wages and opportunities to start their own businesses.

In an October 29, 2026, announcement, the federal competition watchdog urged provinces and territories to follow Ontario’s lead and limit the use of non-compete agreements.

The announcement comes as new research reveals just how widespread these restrictions have become, even in jobs where employers have little reason to impose them.

How Common Are Non-Compete Clauses in Canada?

Research from the Organisation for Economic Co-operation and Development (OECD), cited by the Competition Bureau, found that Canadian employers report 29% to 39% of private-sector employees are covered by non-compete agreements.

Among Canadian companies that use these restrictions, 30% reportedly apply them to every employee, regardless of their role or seniority.

The consequences are significant:

• 23% of Canadian workers who reported having a non-compete said it prevented them from changing jobs.
• 12% said it stopped them from starting a business.
• 44% of workers whose non-compete was unlikely to be upheld in court said they would still turn down a competing job.

In other words, employees are giving up opportunities because of restrictions that may not even be legally enforceable.

Employment Lawyer Jon Pinkus Weighs In

In an October 29 interview with Global News, employment lawyer Jon Pinkus, Partner at Samfiru Tumarkin LLP, explained that non-compete agreements were originally intended for senior employees with access to sensitive business information.

These restrictions were meant to protect employers from employees who could cause genuine harm by joining a competitor. Instead, they’re now appearing in contracts across a much wider range of positions.

Pinkus also explained that many non-compete agreements won’t hold up in court. Employers must demonstrate that a restriction is justified, and courts can invalidate unreasonable agreements that interfere with an employee’s ability to earn a living.

The problem isn’t just whether an employer can enforce a non-compete. It’s how many employees never challenge one in the first place.

Will Canada Ban Non-Compete Agreements?

Ontario has already taken action. Since October 25, 2021, the province has prohibited most new employment non-compete agreements, with limited exceptions involving certain executives and business sales.

The Competition Bureau now wants other provinces and territories to consider similar restrictions. The federal government has also proposed limits for federally regulated workplaces.

These recommendations aren’t a new nationwide ban. Employment rules still differ depending on where you work.

For a detailed explanation of your rights, read our guides to non-compete clauses in Canada and Ontario’s non-compete ban.

What If Your Employer Says You Can’t Work for a Competitor?

Don’t assume your employer is right simply because you signed an agreement.

An employer may threaten legal action or insist that you can’t accept another position in your industry. That doesn’t automatically make the restriction enforceable.

If you’re considering leaving your job or have received a warning about competing with your former employer:

1. Review your employment agreement. Understand exactly what your employer is trying to restrict.
2. Keep any written threats. Save emails, letters and other communications about your non-compete.
3. Don’t abandon a job opportunity without legal advice. Your employer may have no right to stop you from accepting it.

Learn more about how an employment lawyer can help with a non-compete agreement.

Concerned About a Non-Compete Clause? Know Your Rights.

If your employer is trying to prevent you from accepting another job, starting a business or advancing your career, the employment lawyers at Samfiru Tumarkin LLP can review your agreement and help you protect your rights.

We represent non-unionized employees in Ontario, Alberta and British Columbia.

Before you sign, always check first. Contact us today or call 1-855-821-5900.