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Why Noncompetes Have Some Yoga Instructors Off Balance

DEBBIE ELLIOTT, HOST:

You wouldn't think of yoga instructors as being scared or stressed out on the job, but some are because of something called a noncompete. Those are employment agreements that block workers from taking a new job with a rival company. President Biden wants to limit or ban them. NPR's Andrea Hsu tells us why noncompetes have some yoga instructors off balance.

ANDREA HSU, BYLINE: In the pandemic, a lot of yoga teachers moved their classes outdoors or online.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED PEOPLE: (Chanting).

HSU: But for some, simply doing that could violate their employment contract, their noncompete agreement, bringing tension and anxiety into a practice that is all about calm and healing. Now, not every yoga studio uses noncompetes, but some prominent ones do. Until recently, the Down Under School of Yoga in Boston was one of them.

EINAT PELED-KATZ: It was just the way it was.

HSU: Einat Peled-Katz was a yoga teacher there until 2018.

PELED-KATZ: Like, everybody in the Boston scene knows that this studio requires a noncompete.

HSU: Under the agreement Down Under's teachers could not teach anywhere else within a few miles of its three studios, either while employed or for one year after, without permission. They could not contact any of the students. President Biden has talked about workers feeling powerless in the face of noncompetes. That's how Peled-Katz felt at one point. She wanted to leave the studio, but worried about having to give up teaching for a year.

PELED-KATZ: It took me months and months to come to terms with this because it's a big loss.

HSU: Financially and emotionally. She puts it this way - yoga teachers teach because they love yoga. They don't think of it as a business. For them, it's a spiritual practice.

PELED-KATZ: And there is this feeling like I don't want to be the one that creates problems. I should be able to make peace within myself and move on.

HSU: Now, it's not just yoga teachers who have to deal with noncompetes. Callie and Hagana Kim discovered that when they opened a fitness studio in Philadelphia four years ago.

CALLIE KIM: It was very difficult to find teachers who were not subject to noncompetes.

HSU: Especially for barre, a workout that incorporates ballet, yoga and Pilates.

C KIM: But we have encountered situations where we made an offer to a yoga teacher, and they were told you'll be fired if you take that other position.

HSU: Callie and Hagana Kim both happen to be lawyers. Callie, in fact, used to negotiate noncompete provisions for corporate executives, the kind of highly paid people who could take company secrets to a competitor. But for your everyday neighborhood yoga teacher who pays for their own training and barely scrapes by, why? The Kims don't believe those noncompetes would hold up in court. They're too broad.

HAGANA KIM: We know that it's just not enforceable. You know, it's...

C KIM: It's a deterrent.

H KIM: Yeah, right.

C KIM: It's a deterrent.

HSU: They scare workers away from looking for other jobs. Lots of employers use noncompetes, even in states that ban or limit them. The White House says tens of millions of workers sign them, not just in fields like science and tech and banking, but also construction, hotels and, yes, fitness. Attorney Joy Einstein helps yoga studios write their noncompetes. She says, think about it this way. You've invested a lot in the reputation of your studio.

JOY EINSTEIN: Just to have someone come and swoop in and say, I'm going to take all that investment that you've made and carry it with me to a new studio - I mean, that would be a huge blow.

HSU: Back in Boston, Justine Cohen, the owner of Down Under School of Yoga, thinks back to when she first opened the studio 18 years ago. She says it was a free-for-all.

JUSTINE COHEN: Teachers walking in with clipboards and gathering names and then opening literally upstairs or next door.

HSU: She saw her noncompete as a way to professionalize an unregulated industry. But a number of her teachers were unhappy. This spring, more than two dozen former teachers signed an open letter. They called on the studio to remove the, quote, "onerous requirements" from its contracts. The teachers said the noncompete caused them pain and left them in constant fear of being sued. Days after the letter was posted to Facebook, Cohen apologized, acknowledging her employment agreement, quote, "feels punitive."

COHEN: I think within a couple of days, I'd personally written to any ex-teachers who might have still been under their noncompete and just said it's gone.

HSU: Cohen then had her current teachers rewrite the contract, and they came up with a new system where you choose your level of commitment to the studio. Those who want to teach exclusively for Down Under may be paid at a higher rate. And the result...

COHEN: Ninety-five percent of them actually picked the most committed level, like, teaching all their classes at our studios.

HSU: With this new system, she says, she no longer needs a noncompete. That chapter is over.

Andrea Hsu, NPR News. Transcript provided by NPR, Copyright NPR.