Bill > H4323

This bill, titled the "Massachusetts Noncompetition Agreement Act," aims to regulate and enforce noncompetition agreements, which are contracts preventing employees from working for competitors after leaving a company. It repeals existing laws on the subject and introduces new provisions, including the adoption of the Uniform Trade Secrets Act to define and protect trade secrets, which are defined as valuable, confidential information that provides a competitive advantage and is actively protected by the owner. The bill then establishes strict requirements for noncompetition agreements to be considered valid and enforceable, such as being in writing, signed by both parties, and provided to the employee with sufficient notice, often requiring legal counsel consultation. These agreements must be narrowly tailored to protect legitimate business interests like trade secrets, confidential information, or goodwill, and cannot exceed 12 months in duration unless the employee has breached their fiduciary duty or stolen company property, in which case the duration can be extended to two years. Furthermore, noncompetition agreements must be reasonable in geographic scope and the types of activities restricted, and crucially, they must include a "garden leave clause" where the employer pays the employee at least 50% of their highest annualized base salary during the restricted period, except in cases of employee breach. The bill also specifies that these agreements are not enforceable against certain workers, including non-exempt employees, interns, students, employees terminated without cause, or those under 18, and prohibits courts from rewriting unenforceable agreements. Finally, it mandates that legal actions related to these agreements must be brought in the county where the employee resides or in Suffolk County, with exclusive jurisdiction granted to the superior court.