In 2018, Massachusetts passed a new non-competition law that narrowed the circumstances where employers can ask an employee to enter into an agreement to not work for or start a similar business that would directly compete against a current employer. It may not be legally enforceable even when an employee signs a non-competition agreement.
Generally, a non-competition agreement is only enforceable to the extent necessary to protect the employer’s legitimate business needs and confidential information. An overly broad non-competition can prohibit an employee from working anywhere else. Some facts to consider in enforceability include: length of time of the non-competition period; geographical scope; the business intent; the risk of competition or exposure of confidential information; and the restriction of the employee’s right to earn a living.
All Massachusetts non-competitions must be limited to 12 months. Non-competition agreements can also be unenforceable against certain workers and in special situations, including:
- Employees that are non-exempt under the Fair Labor Standards Act;
- Undergraduate students and or graduate student interns;
- Employees who are 18 years old or younger;
- Lawyers;
- Physicians, nurses, psychologies, and social workers;
- Individuals in the broadcasting industry; and
- Employees who have been laid off or terminated without cause.
Employers may also ask workers to sign a non-solicitation agreement at their hiring or the end of their employment. Non-solicitation agreements prevent employees from wrongfully persuading business or current employees away from the employer. Similar to non-competition agreements, not all non-solicitation agreements may be legally enforceable and must be reasonably tailored to protect the business.
We can help you understand the agreements before or after they have been signed. We can also defend clients facing potential legal action from their former employers attempting to enforce signed non-competition and non-solicitation agreements.