By: Andrew P. Botti
As of October 1, 2018 the noncompetition law of Massachusetts changed dramatically with the passage of G.L. 149, §24L. The new statute provides a series of detailed requirements and qualifiers which are now “must haves” for non-compete agreements to be enforceable in a Massachusetts Court.
The major changes are as follows:
The Massachusetts Equal Pay Act will become effective on July 1, 2018. It calls for all Massachusetts employers, irrespective of size, to pay men and women the same for comparable work. The new law, which amended G.L. c. 149, Section 105A, provides in pertinent part:
On March 1, 2018, the Massachusetts Attorney General’s Office issued Guidance to assist companies in complying with the Equal Pay Act, which goes into effect on July 1, 2018.
To read the Guidance, click here.
Click the image above to read the Act.
In this latest Legislative session on Beacon Hill it appears that the House and the Senate have reached certain compromises concerning non-compete legislation which would alter considerably the existing non-compete legal landscape in Massachusetts. The new version of the bill – HO 4434 – would alter Chapter 149 of the General Laws and provide generally as follows:
To learn about the Equal Pay Act that takes effect in July of 2018, click here.
Although burning the midnight oil last night, a Joint Conference Committee failed to reach agreement on a compromise bill by the established deadline of midnight, July 31.
Among other differences, the House and Senate versions of so-called non-compete reform contained very different “garden leave” provisions.
The House version required 50% pay for a one year “sit it out” period, while the Senate version required 100% pay for a maximum 3 month non-compete period. The House version also allowed the parties to come up with another form of acceptable consideration to support the non-compete period.
The Governor indicated that he favored the House version of the proposed reform.
At this point, the issue of non-compete reform is off the table until January 2017, the start of the next legislative session on Beacon Hill.
Commonwealth of Massachusetts Appeals Court – Gabriel Care vs. Borden Care
Gabriel Care, LLC vs. Borden Care, LLC, & another
For the first time a case involving competing visiting nurse associations has been reported out of the Massachusetts Appeals Court. Although by statute nurses are not subject to non-competes, there are still common law restrictions on what a present employee may do in preparation to compete.
“A duty of loyalty is imposed on an employee who occupies a position of trust and confidence.” Gabriel Care, LLC v. Borden Care, LLC, et. al., 2016 Mass.App.Ct, at page 10. With respect to a registered nurse who was planning to quit her current position with a foster care agency and start her own competing business, the Appeals Court held:
Click the image above to read the joint letter from various Massachusetts businesses supporting H.4434 and objecting to S.2418.
On Friday, July 22, 2016, the Governor’s office released the following statement concerning the various legislative reform bills recently promulgated by Beacon Hill lawmakers:
“The Governor favors the House version of the non-compete legislation because he believes it better balances workers’ abilities to seek new employment while ensuring cutting edge businesses can protect essential intellectual property. Finding the right compromise on this issue is essential to ensuring innovative businesses want to stay and grow in the Commonwealth.”
Click below to watch a portion of Andrew Botti’s “The State of Non-Compete Agreements in Our State: What’s Pending on Beacon Hill this Legislative Session?” presentation from January 2016.
On July 11, 2016, the State Senate promulgated its version of so-called non-compete reform legislation in S2418, which would amend Chapter 149 of the General Laws governing Labor and Industries.
Massachusetts Business Competition Law 