Senator Brownsberger and Representative Lori Ehrlich have filed “An Act relative to the judicial enforcement of non-competition agreements” in both the Senate and the House. This bill would prohibit the use of non-compete agreements but continue to allow other tools to protect business after separation, such as non-solicitation agreements, nondisclosure agreements. The bill is prospective and does not impact existing agreements.
SD809 & HD2332
An Act relative to the judicial enforcement of noncompetition agreements.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
Chapter 149 of the General Laws of Massachusetts shall be amended by inserting the following as Section 19D:-
Section 19D. Noncompetition Agreements
Any written or oral agreement arising out of an employment or independent contractor relationship that prohibits, impairs, restrains, restricts, or places any condition on a person’s ability to seek, engage in, or accept any type of employment or independent contractor work, for any period of time after an employment or independent contractor relationship has ended, shall, to that extent, be void and unenforceable. This section does not render void or unenforceable the remainder of the agreement containing the unenforceable noncompetition agreement, nor does it affect (i) covenants not to solicit or hire employees or independent contractors of the employer; (ii) covenants not to solicit or transact business with actual or prospective customers, clients, or vendors of the employer; (iii) nondisclosure agreements; (iv) noncompetition agreements made in connection with the sale of a business or partnership or substantially all of the assets of a business or partnership, when the party restricted by the noncompetition agreement is an owner of, or partner with, at least a ten percent interest of the business who received significant consideration for the sale; (v) noncompetition agreements outside of an employment or independent contractor relationship; (vi) forfeiture agreements; or (vii) agreements by which an employee agrees to not reapply for employment to the same employer after termination of the employee.
This section shall apply to all contracts and agreements executed after the effective date of this act.
Office of State Senator William N. Brownsberger