So far this year, there have been 59 noncompete bills pending in 23 states1 — excluding the two pending federal noncompete bills, D.C.’s new law to ban most noncompetes, and any proposed bills that are circulating, but have not yet been filed.
Four bills have already died — each in a state that had only one pending bill2 — leaving the current tally at 55 noncompete bills still pending in 19 states.
The 19 states are Connecticut, Georgia, Illinois, Iowa, Louisiana, Minnesota, Missouri, Nevada, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas, Vermont, and West Virginia.
In this series, we are providing details on all pending bills (and any new ones that are filed) — and we will be simultaneously updating our Changing Trade Secrets | Noncompete Laws page. Note that the summaries are (sort-of) color coded for the nature of the bill (ban, modification or establishment of standards, reversal of prior changes) and the groups for whom it creates exceptions or specific limitations (medical, low-wage workers, others).
Up today: Minnesota
Minnesota has the following four pending bills:
- HF.999 (A bill for an act relating to employment; providing that covenants not to compete are void and unenforceable; providing for the protection of substantive provisions of Minnesota law to apply to matters arising in Minnesota; proposing coding for new law in Minnesota Statutes, chapter 181): Introduced on February 11, 2021, the bill (which would operate prospectively only) would ban noncompetes for low-wage workers, require the payment of what (because of the Massachusetts Noncompetition Agreement Act) has become known as “garden leave” for anyone else, require Minnesota choice of law and forum, and permit recovery of attorneys’ fees by the employee. Specifically, the bill would:
- ban noncompetes for anyone earning less than “the median family income for a four-person family in Minnesota, as determined by the United States Census Bureau, for the most recent year available at the time of the employee’s termination”;
- require the employer to pay (for anyone earning more than the wage threshold) “on a pro rata basis during the entirety of the restricted period of the covenant not to compete at least 50 percent of the employee’s highest annualized base salary paid by the employer within the two years preceding the employee’s separation from employment”;
- require adjudication in Minnesota and set the protections of Minnesota law as the floor for any employee who “primarily resides and works in Minnesota” unless (as in California since 2017) the employee “is in fact individually represented by legal counsel in negotiating either the venue or forum . . . or choice of law”; and
- permits a court to award reasonable attorneys’ fees to “an employee who is enforcing rights under this section . . . .”
The bill is pending before the House Labor, Industry, Veterans and Military Affairs Finance & Policy Committee.
- HF.1629 (A bill for an act relating to employment; providing that covenants not to compete are void and unenforceable; providing for the protection of substantive provisions of Minnesota law to apply to matters arising in Minnesota; proposing coding for new law in Minnesota Statutes, chapter 181): Introduced on February 26, 2021, the bill is the same as HF.999 (above).
The bill is pending before the House Labor, Industry, Veterans and Military Affairs Finance & Policy Committee.
- HB.1917 (A bill for an act relating to relating to health; protecting the physician-patient relationship by prohibiting noncompete agreements; proposing coding for new law in Minnesota Statutes, chapter 145): Introduced on March 4, 2021, the bill (which would operate prospectively only) would ban noncompetes for physicians, specifically, “a physician licensed under chapter 147 to practice medicine in” Minnesota.
The bill is pending before the Senate Health and Human Services Finance and Policy Committee.
- SB.2130 (A bill for an act relating to relating to health; protecting the physician-patient relationship by prohibiting noncompete agreements; proposing coding for new law in Minnesota Statutes, chapter 145): Introduced on March 17, 2021, the bill (which would operate prospectively only) is the Senate analogue of HB.1917 (above), i.e., to ban noncompetes for physicians.
The bill is pending before the Senate Health and Human Services Finance and Policy Committee.
Next up: Missouri.
And, remember, if you want to see a summary of the current noncompete law in any state (and D.C.), please refer to our 50-state noncompete chart, which is updated on a continual basis, as the laws change.
*A huge thank you to Erika Hahn for all of her extraordinary help in tracking and monitoring all of the bills.
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[1] The 23 states are: Connecticut, Georgia, Illinois, Iowa, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Nevada, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Texas, Utah, Vermont, Virginia, and West Virginia.
[2] The four states are: Kentucky, Mississippi, Virginia, and Utah.