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Workers are switching jobs more than ever, but here’s why your hairstylist might be stuck

Noncompete contracts have become an expectation in the hair Industry.

  • An-Li Herring/WESA
In 2018, hairstylist Heather Johnson opened Alchemy Dry Cut Lounge in Lawrenceville even though she expected it would cause a court battle over a noncompete contract she had signed with her former employer.

 An-Li Herring / 90.5 WESA

In 2018, hairstylist Heather Johnson opened Alchemy Dry Cut Lounge in Lawrenceville even though she expected it would cause a court battle over a noncompete contract she had signed with her former employer.

Finding the right hairdresser often kicks off a years-long relationship. There’s trust involved – no one wants a bad haircut – and it’s common for stylists to get to know personal details of their clients’ lives.

So if stylists relocate, clients follow.

Heather Johnson had this experience when she opened Alchemy Dry Cut Lounge in Lawrenceville in 2018. She estimates that 90% of her clients (including 90.5 WESA’s An-Li Herring) moved with her from her previous job at MCN Salon in Shadyside.

“I was really, really blown away by how many clients followed me. … It was almost everybody,” Johnson remembered.

Today, Alchemy employs about a dozen people, and Johnson plans to fill more chairs in her Butler Street storefront.

An-Li Herring / 90.5 WESA

Alchemy Dry Cut Lounge has expanded to the second floor of its Lawrenceville storefront since opening in 2018.

But while the salon might have a bright future, it had a rocky start. Johnson was fired after MCN found out she was working on her new place.

“I knew that they would end up suing me,” she said, because she had signed a noncompete contract at MCN.

Such agreements aim to stop workers from joining or starting rival companies. While they’re historically associated with high-tech and executive-level jobs where employees have access to trade secrets, they’ve become increasingly prevalent in service occupations. Examples include sandwich makersyoga instructorsdogsitters and personal care aides.

Johnson’s contract with MCN barred her from doing business within seven miles of her former salon for one year after leaving. But she moved just two miles.

She said it wasn’t practical to move farther away.

“Seven air miles outside of Pittsburgh is huge. … And at that point in time in my career, I had spent my whole life building my book and my clientele,” she said. “So that was not feasible for me to go all the way out into the suburbs and restart my life.”

MCN declined to comment on the lawsuit, but it eventually dropped the case.

Protecting investments in employees

Noncompetes have become an expectation in the hair Industry, said Nicole Lovato, an educational coordinator at South and North Hills Beauty Academies. A 2015 survey found that about a third of salon owners say they require employees to sign noncompetes, and Lovato said she knows dozens of stylists who have been sued and lost for violating the agreements.

She said they’re a major topic of conversation when recruiters visit.

“The first hands that go up from the students are, ‘Do you make us sign a contract?’ … It’s a very big fear,” she said.

An-Li Herring / 90.5 WESA

Nicole Lovato has taught at South and North Hills Beauty Academies for two decades. She said during that period, noncompete agreements have become more common in the hair industry.

With larger chains, the answer is virtually always “yes,” she said, and she noted that independent establishments often use noncompetes, too. She said they’re quick to give students one reason why: Salons invest heavily in employee training.

“They’re going to bring educators in,” Lovato said. “And I can tell you from working in a school, that is not an inexpensive feat. You pay for these educators to come in. You pay for their room. You pay for the board. … So you’re investing thousands of dollars into these employees, so I can kind of see both sides of it. I truly can.”

Attorney Shawn Flaherty represented Whitehouse Salon in Shadyside in a noncompete dispute that settled last summer. He said the contract was justified because it protected the owners’ legitimate business interests, such as a well-trained workforce and proprietary information.

“I think if they didn’t have it, that would infringe upon their abilities to make the investment [in those assets]. I think they would be less inclined to do so,” Flaherty said. “Or I think they’d be less inclined to hire a lot of people, too.”

Michelle Leonard, the director at Pittsburgh Multicultural Cosmetology Academy, noted also that when stylists leave a salon, they tend to leave in groups to start their own venture together. She said that possibility represents an existential threat for employers.

“[Salon staff] can make up just any reason to put their own money together, move across the street, move next door, or whatever. And now you’ve ruined this other person’s business because she didn’t have [a] contract [with employees],” Leonard said.

Right to make a living

While employers in Pennsylvania can use noncompetes as a condition of employment and other benefits, it is illegal to restrict workers over excessive distances or periods of time.

“A noncompete obviously restricts somebody’s ability to make a living. And for that reason, courts will construe these very narrowly in favor of the employee,” local attorney Joseph Hudock said.

“It doesn’t mean the employee always wins,” he added, “but to the extent that there’s any ambiguity [in the contract], it’s going to be construed against … the employer.”

Pittsburgh labor lawyer Christine Elzer said businesses also have more of an uphill battle when they sue someone who works in a licensed occupation such as hairstyling. “That’s what [the employees are] trained to do. And if you freeze them out of the market, it is going to interfere with their right to make a living,” she said. “And typically, the lower the wages an employee makes, the better an argument they’re going to have that they’re going to have a hard time making a living.”

But regardless of the legal merits, Elzer said, workers usually agree to noncompetes.

“They feel pressured to sign it or lose their job,” she said. “And then, even if the noncompete is not valid, they’re afraid to do anything that might violate it, knowing that even if they were to win, it’s going to cost them tens of thousands of dollars to defend [themselves]. And lower wage workers just don’t have that kind of money.”

Given such concerns, several states don’t enforce noncompetes, and 10 ban them for qualifying workers who earn below a certain income floor. President Biden, meanwhile, has ordered the Federal Trade Commission to explore options for curbing their use nationally because the White House says a less competitive labor market hurts workers.

Heather Johnson said 90% of her clients followed her from her old salon when she opened Alchemy Dry Cut Lounge in 2018. She now employs about a dozen people.

“It suppresses wages. It limits the opportunities for growth for employees and restricts their movement,” University of Pittsburgh law professor Andrele Brutus St. Val said. She said those effects are especially apparent in today’s tight labor market, which has prompted many workers to leave their jobs to pursue higher pay.

Meanwhile, a 2021 study found that when Oregon restricted the use of noncompetes in 2008, the wages of hourly workers rose between 2% and 3% on average. The effects were larger in occupations where noncompetes are more common.

St. Val said the agreements harm consumers, too, partly because less competition translates into higher prices. And in the hair industry, she added, clients often are attached to the stylist, not the salon.

“You go to your stylist because she’s good, and she’s gotten to know you. She knows your hair. She knows your style. The employer wouldn’t know that,” St. Val said.

“People come and form a relationship with you, [the hairdresser], and you’re the one that has the skills,” agreed Kelley D’Atri, who owns Mint Salon and Gallery in Shadyside.

Like Johnson, she was sued by her former employer, Puccini Hair Design in Oakland, when she decided to strike out on her own. The case eventually fizzled. But D’Atri said it remains one reason she’ll never use noncompetes with her staff.

“If you’re going to leave, just do it respectfully,” she said. “I have no issues telling every single client where you’ve gone because it’s your client.”

Johnson said she doesn’t use noncompetes either. But they still dog her.

“It’s really hard to hire hairstylists because a lot of them [have signed] noncompetes,” she said. “They will stay [at the same salon] year after year and be miserable and too afraid to take on the noncompete. So I guess [the contracts] work, right?”

But for her, she said, they’re just a cost of doing business in an industry where they’re now common.

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