It’s been several months since we surveyed top automotive executives and insiders on the major legal issues facing the industry for our 2023 Automotive Trends Report.
As the automotive world continues to evolve and navigate a shifting legal landscape, we look at some of the major themes driving it forward… and the ones that might be in the rearview mirror.
What are the major Labor and Employment issues driving the future of the auto space? Abad Lopez and James Hermon dive in.
A mere 19% of respondents to our 2023 Automotive Trends Report cited “restrictive clauses involving non-competes” as a major concern for labor and employment in the automotive space. Six months and several updates to restrictive covenant laws later, this trend appears to be on the rise. In the automotive industry, where the need for tech workers continues to climb, changes to restrictive covenants are making it more difficult for employers to retain talent and protect confidential information. These updates are happening at both the federal and state level: While the Federal Trade Commission has proposed a rule to ban non-compete agreements, laws to ban certain types of restrictive covenants for some workers have been passed in Illinois and New York.
The “return to office” movement
In the battle over returning to in-person work, employees are winning across industries. In the automotive sector, top-down mandates have fueled the rise of unionization efforts, giving low wage workers more bargaining power than pre-pandemic. Many automakers and technology suppliers have reported that getting knowledge workers specifically back in the office is becoming increasingly difficult, leading to what some view as a decline in innovation efforts. Adding to the dilemma, automakers are feeling pressure to retain and hire fewer workers as they endeavor to shift budgets towards the production of electric vehicles.