Legislators Hear Testimony on Non-Compete Restrictions

Opinion

Today marked a milestone in the legislation relating to non-competes in Massachusetts. The Joint Committee on Labor and Workforce Development held its public hearing on two house bills that would attempt to redefine the rules governing “restrictive employee covenants and non-compete agreements.”

This effort began in early January when Rep. William N. Brownsberger (24th Middlesex District) filed House Bill No. 1794, which would effectively prohibit restrictive employee covenants in line with similar provisions in the State of California. Rep. Lori Ehrlich (8th Essex District) also filed House Bill No. 1799, which made significant clarifications to non-compete agreements in line with the State of Oregon. Subsequently, compromise legislation was drafted by Rep. Brownsberger and Rep. Ehrlich.

A good summary of the salient points of this bill can be found at the Trade Secret and Noncompete Blog that is run by Russell Beck of the Foley and Lardner law firm, who participated in the drafting of this legislation.

The hearings on non-competes began with introductions by Rep. Ehrlich and Rep. Brownsberger, who cited complaints over abusive and over-reaching non-compete agreements. They highlighted the fact that the current law is over 200 years old and the rewrite has been long overdue. Attorney Russell Beck and Robert Mantell of the Massachusetts Employment Lawyers Association provided a detailed summary of the compromise legislation and described the key provisions of the bill.

At one end of the spectrum, the committee heard from those who made the argument that the original Brownsberger-Jehlen Bill No. 1794 was “the only ethical thing to do.” The committee also heard testimony from those who felt that the “200 years of jurisprudence” was perfectly adequate and did not need any change.

Up until now, the discussion of these changes has been largely in the blogosphere, and the participants represented members of the high technology sectors of the industry. At the hearing however, members of the non-high technology sectors and small businesses presented strong argument against the proposed changes.

“Talented individuals are leaving the state in large numbers because they see non-competes as unfair,” said one concerned individual who favored changing the current law. “I am willing and able to work but no one will hire me because of the … Next Page »

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Amrith Kumar is a technologist and entrepreneur who has helped design, architect and create enterprise class software and hardware products. He is the co-founder of the Boston Big Data Summit and writes a blog, Hype Cycles, which discusses a variety of technology related subjects. Follow @

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