As explained most recently at the start of this year, there had been ten states with wage thresholds or other criteria that must be satisfied before a noncompete can be used for a particular employee.
Now there are eleven.
Well, almost “now.”
On August 10, 2022, Colorado will join the ranks of states prohibiting noncompetes for workers who do not meet certain wage thresholds or related criteria.
The eleven states with such criteria, in order of adoption, are: Oregon (originally in 2008, though later updated effective 2022), Illinois (in 2016, though updated effective 2022), Massachusetts (in 2018), Maine (in 2019), Maryland (in 2019), New Hampshire (in 2019), Rhode Island (in 2020), Virginia, (in 2020), Washington (in 2020), and Nevada (in 2021), and Colorado (in 2022).
To help keep track of the changes, we have updated our chart summarizing the current criteria in each of the states. (Note that the specific dollar values may be subject to increase for inflation or otherwise.)
Wage Threshold (August 2022)
|Maine||400% of the federal poverty level ($54,360 (est.))|
|Maryland||$15 per hour or $31,200 annually|
|Massachusetts||Nonexempt under the Fair Labor Standards Act|
|Nevada||Paid solely on an hourly wage basis, exclusive of tips or gratuities|
|New Hampshire||$14.50 per hour (2x federal minimum wage) or tipped minimum wage, whichever applies|
|Rhode Island||250% of the federal poverty level for individuals ($33,975 (est.)) or nonexempt under the Fair Labor Standards Act|
|Virginia||Average weekly wage in Virginia ($67,080†† (est.))|
|Washington||$107,301.04 ($268,252.59 for independent contractors)|
It’s also important to stay abreast of the latest developments around the country. Because of legislative cycles and developments over the year, most of the 24 state bills involving low-wage workers this year have died. However, as of today, four more states are still considering low-wage thresholds. They are Michigan, New Jersey, New York, and Pennsylvania. We will keep you posted on each, and how they progress.
In the meantime, 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 (created in 2010 and updated regularly since to keep track of the ever-changing noncompete laws) can serve as a starting point. (Please note that our 50-state noncompete chart will be updated shortly; you can always find the current version here.)
*A huge thank you to Erika Hahn for all of her extraordinary help in monitoring all of the bills!
†The original post included a weekly threshold. However, given the wording of the statute, the weekly threshold likely does not apply and has been removed.
††Please note that this number has been corrected based on Virginia’s Department of Labor and Industry announcement of the weekly threshold of $1,290 per week for 2022.