New Mass Law Restricts Noncomp Agreements

The Governor last week signed the long-awaited Massachusetts statute that deeply cuts back the enforceability of non-comp agreements for employees. The Act applies to all agreements made on or after October  1.   A detailed analysis will follow, but note that now:

*Maximum time is one year.

*To enforce the agreement, an employer must pay at least half base pay for the term of the restriction, unless employee breached a duty to employer (so called “garden leave” provisions).

*No noncomp will be enforced against employees let go without cause.  (This will put pressure on contractual definitions of “cause”).

*Employers can still prevent poaching of employees or pitching employer customers.

*Noncomps made in connection with the sale of a business will still be enforced.

Not quite California, where most noncomps are void, period; but a radical change in Mass business law.

 

 


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