*CORRECTED (February 13, 2023)*
Since last week’s update on new noncompete legislation, we have 1 more state with a bill, 2 new state bills, and 1 more federal bill that was reintroduced.*
New State: Maryland
The additional state is Maryland, which introduced a bill to increase its existing low-wage threshold from $15 per hour or $31,200 annually to 150% of the minimum wage, currently 13.25 per hour (and $12.80 per hour for small employers, i.e., employers with 14 or fewer employees).
New State Bills: Maryland and Iowa
In addition to the Maryland bill, Iowa had another bill related to mental health professionals, that had not been available earlier.
New Federal Bill
On the federal side, Senators Marco Rubio and Maggie Hansen reintroduced the Freedom to Compete Act. Like the prior versions, the bill would ban noncompetes for anyone not exempt under the Fair Labor Standards Act of 1938 (29 U.S.C. 201, et seq.) — the approach taken first by Massachusetts and later by Rhode Island.
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Reminder: Last year, there were 98 noncompete bills in 29 states, plus D.C. and seven federal bills. Given that it’s just the beginning of February and most legislative sessions only started in January and last two years, we are well on our way to surpassing last year’s numbers — despite the FTC’s proposed ban to wipe out all employee noncompetes and render all of this moot.
Stay tuned.
Resources to help
In the meantime, we know first hand how hard it is to keep up with the ever-changing requirements around the country. To help, we have created the following resources (available for free):
- 50-State Noncompete Law Chart, the first of its kind and regularly updated (downloadable PDF);
- Chart of Noncompete “Low Wage” Thresholds and Criteria (downloadable PDF);
- Notice requirements summary chart, providing details for each of the 8 states (plus D.C.) that has notice requirements related to noncompetes (downloadable PDF);
- “Changing Trade Secrets | Noncompete Laws” (dedicated blog page) now provides a current detailed summary of the changing landscape of trade secret laws and noncompete laws around the country, state by state and at the federal level; and
- Trade secret and other legitimate business interest protection plan strategy and checklist.
We also have a 50-State and Federal Trade Secret Law Chart, providing a comparison the trade secrets laws nationally to the Uniform Trade Secrets Act (downloadable PDF).
We hope you find all of these resources useful.
And please note that we are grateful for all of the input we’ve received over the years, and welcome any suggestions for improvements that you may be willing to share.
*Correction: The Indiana bill I thought had progressed to conclusion, has not – it only progressed through the state senate.
*A huge thank you to Erika Hahn for all of her extraordinary help in monitoring all of the bills filed around then country! And “hat tip” (as John Marsh would say) to John Drake and Zackary Zagger for finding the enactment of the Indiana law before we did!