There has been a ton of legislative, regulatory, and judicial activity around noncompetes and other restrictive covenants over the past two or so months.
Here is a summary of the key updates:
- Colorado enacted its second noncompete statutory update taking effect this year. More to come soon, but note that it takes effect on August 10, i.e., 91 days after the legislature adjourned (which was May 11). (For more information on the prior update, see What2Watch4: Two More Upcoming Noncompete Law Changes — Colorado and D.C.);
- Illinois passed its second noncompete statutory amendment this year. This amendment is much more limited, focused just on nurses. It becomes effective on July 1. More to come on this as well. (For more information on Illinois’s prior update, see Illinois Noncompete Bill Becomes Law (and So Does Nevada’s));
- Iowa and Kentucky each passed new restrictions on noncompetes for healthcare agency workers. More on these to come;
- The Uniform Restrictive Employment Agreement Act has failed in each of the four states (Colorado, Oklahoma, Vermont, and West Virginia) in which it was proposed;
- The Federal Trade Commission now has a full complement of commissioners, and has indicated that it plans to regulate employee noncompetes. (Note that, no surprise, the FTC has been bearing down on noncompetes in the M&A context, where there are multiple companies involved and the FTC’s authority is more clear.) I will be summarizing this soon;
- The U.S. Department of the Treasury issued another report on noncompetes with unsurprising results. More on this soon, too;
- D.C. continues to make significant progress moving amendments to its new noncompete law forward. The new law remains scheduled to become effective October 1. Stay tuned for an update on this too;
- There has been some new case law providing a few more datapoints around the Massachusetts Noncompetition Agreement Act (the “MNAA”), G.L. c. 149, § 24L. Of course, I will be providing an update on this shortly too; and
- Microsoft decided to curtail the use of noncompetes for most (but not all) employees. (Not much to add to this one; we’ll see if others follow suit.)
Why I am so far behind…
As you can tell, I am way behind on posting.
The reason (if you care – though no reason you should) has to do with other activities over the past two months. I was away for a week of conferences (including the Sedona Conference, where we discussed, among other things, the now-complete Employment Life Cycle commentary (the most current version is behind a paywall), which has a ton of great information about protecting trade secrets at the key times during the employment lifecycle). The next week, I went to the AIPLA Spring Meeting in New Orleans, where I wound up spending the week stuck in bed in a hotel room with Covid. I spent the next 2.5+ weeks with a pretty-bad Covid rebound and related illness. Fortunately, I was better just in time for a two-week road trip with my son, driving from San Fransisco, up to Cannon Beach, Oregon (see the picture above), and home along the Oregon Trail (mostly). (FYI, I highly recommend it; lots of fun!) And of course, throughout, there has been plenty of work that has needed to get done too.
But now, I’m back and will be updating everything shortly!
Still to come…
As I get caught up on the topics above, you should also watch out for our chart of the noncompete laws around the country, which will be updated to reflect the changes in Colorado, Illinois, Iowa, and Kentucky laws, as well as the Wyoming Supreme Court decision, changing Wyoming from a reform state to a red pencil state. (I will explain all of this in an upcoming post.)
*Thank you to Erika Hahn for helping me stay on top of all of the recent developments!