Starting on January 1, the compensation thresholds below which noncompetes cannot be used for employees in each of Illinois, Oregon, and Washington will increase.
Specifically, in Illinois noncompetes will no longer be useable for employees earning (or who are expected to earn) under $75,000 (up from $13 per hour). Also, Illinois went even further and created a threshold for nonsolicitation and no-recruit agreements, prohibiting their use for employees who earn (or are expected to earn) less than $45,000.
In Oregon, in contrast, noncompetes cannot be used for employee earning less than $100,533 (up from the median family income for a four person family (and a separate threshold for broadcasters)).
In Washington, the thresholds for employees bumped up to $107,301.04, and to $268,252.59 for independent contractors.
Of course, if you have not already addressed the changes in Nevada (which took effect earlier this year), now is the time. Specifically, the agreement cannot apply to anyone “paid solely on an hourly wage basis, exclusive of any tips or gratuities.”
Similarly, this would be a good time to ensure that the compensation thresholds and standards applicable to your employees in each of the 10 states that have them have been addressed. The other states are Massachusetts, Maine, Maryland, New Hampshire, Rhode Island, and Virginia.
While you’re at it, you may also want to check your agreements more generally to make sure you are complying with the noncompete laws in all states in which you have employees. Our 50-state noncompete chart (updated regularly to keep track of the changing laws) can serve as a starting point.
Good luck, and happy New Year!