Amendment #13 to H4165

Amendment banning non-compete agreements for employees not regularly exposed to trade secrets

Mr. Coppinger of Boston moves to amend the bill by inserting after section 56 the following section:-

“SECTION 56A. Chapter 93 of the General Laws is hereby amended by inserting, after section 42A, the following section:-

Section 42B.  Any written or oral contract or 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 be void and unenforceable with respect to that restriction; provided, that the employee or independent contractor on whom the restriction is placed is in a position, or providing a service, of such a nature that it is not reasonably foreseeable, at the time that the contract or agreement is entered into, that the employee or independent contractor shall be exposed to a trade secret.  The term “trade secret” as used in this section shall have the same meaning as set forth in section 30 of chapter 266.

This section shall not render void or unenforceable the remainder of the contract or agreement. Nor shall this section affect (i) covenants not to solicit or hire employees or independent contractors of the employer; (ii) covenants not to solicit or transact business with customers of the employer; (iii) non-disclosure agreements; (iv) noncompetition agreements made in connection with the sale of a business or substantially all of the assets of a business, when the party restricted by the noncompetition agreement is an owner of at least a 10 per cent interest of the business who received significant consideration for the sale; (v) noncompetition agreements outside of an employment 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.

For the purposes of this section, the term “employee” shall mean an employee as defined in section 148B of chapter 149.

This section shall be construed liberally for the accomplishment of its purposes.  Nothing in this section shall preempt tort or contract claims, or other statutory claims, based upon an employer’s use, or attempted use, of an unlawful contract or agreement to interfere with subsequent employment or contractor work.

This section shall apply to all contracts and agreements, including those executed prior to the effective date of this section.”.