Non-Compete Legislation: Down to the Wire Again

On Wednesday, the Massachusetts Senate passed an Economic Development bill that revives the long-debated issue of non-compete legislation in the Commonwealth.

As this blog reported earlier this year, the Joint Committee on Labor and Workforce Development submitted a new bill, H.B. 4419, addressing non-competes in place of six bills filed last year. The non-compete language contained in the Senate’s Economic Development bill tracks that of H.B. 4419, including a key provision mandating “garden leave” payments or “other mutually-agreed upon consideration” to an employee during the restricted period following the termination of the employment relationship; a provision requiring advance notice of the non-compete to employees; a provision requiring additional consideration for a non-compete entered into after the commencement of employment; and a provision codifying existing law permitting courts to reform overbroad non-competes.

The Massachusetts House of Representatives’ Economic Development bill, passed two weeks ago, did not contain any provisions relating to non-competes. As a result, this issue will be decided by a House/Senate Conference Committee. With the end of the legislative session looming on July 31, the House and Senate have a very short window to come to a decision.

In the rapidly changing business world, protecting a company's human capital and proprietary information is critical to maintaining a competitive edge. On this blog, Nutter's experienced Business Litigation and Labor, Employment & Benefits attorneys offer news and insights on all aspects of restrictive covenants and trade secrets—from analyzing a rapidly evolving body of case law, to summarizing new legislation and legislative efforts, to providing other need-to-know updates and more.

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