Noncompete Reform is Finally Passed by the Legislature
After a decade of learning and consensus building, I am proud to say that the Massachusetts Legislature has finally passed non-competition agreement and trade secret reform!
Over the years, I have observed, and studies back up those observations, that the use of noncompetes has pervaded every sector of the economy and they are being used in increasingly egregious ways. Nationally, research shows that up to 1 in 5 workers is in a noncompete. A single mother working at a pizza parlor testified that it cost her $50,000 that she didn’t have to fight a noncompete, just so that she could work at another restaurant in her community. Noncompetes were never intended to be used this way. High profile cases against major companies like Jimmy Johns, Subway, ServiceMaster and others are becoming increasingly common, in which the fundamental right of people to seek and enter into employment is repeatedly infringed.
I have been working on reigning in the exploitative use of noncompetes and providing employees with information and a small measure of leverage for years now. So I am proud to say that with this bill, these goals have been met, and then some. In a masterful balance, the bill now awaiting a signature from Governor Baker, not only deals with some of the abuses in practice but also sets limitations on how they can be used legitimately. And it does this while both strengthening our trade secret law and not interfering with other employment contacts: nondisclosures or non-solicits.
This legislation unleashes our state’s potential for innovation and growth. Mobility in the workforce is a key part of anyone’s decision when they take a job. A huge number of students graduate college in the Commonwealth every year, most of whom look for a job in the field they just received a degree in. But it is a huge disincentive to stay in the state if these young people believe, rightly, that they may be limiting their future potential for upward movement.
By passing this bill, we are bringing relief to the numerous citizens of the Commonwealth caught in spurious noncompetes, while sending a message to our workers and entrepreneurs that Massachusetts will always strive to be a fair place to live and work.
I owe a big thank you to everyone who has made this possible, the advocates, the experts, and the individuals trapped in noncompetes themselves, who all worked tirelessly to find a solution that will free workers and entrepreneurs to move Massachusetts forward.
Additionally, I thank Speaker DeLeo for enduring, with me, the long journey this bill has taken to get here today. For the difference this bill will make in the lives of thousands of Massachusetts residents, it has been a journey worth taking.
Thank you especially to my tireless Senate partner Will Brownsberger, advisor, scribe, and friend Russell Beck who literally wrote the book on noncompetes, Rep. Paul Brodeur, Rep. John Scibak, Rep. Joe Wagner, so many supportive colleagues, Matt Marx, Steve Chou, journalists (Scott Kirsner, Steven Greenhouse, Jon Chesto, Kris Olson, Conor Dougherty), Caroline Huang, Andrea Kramer, David Amstutz, US Senator Elizabeth Warren -- and former law professor -- for federal action, Former President Barack Obama for White House invitations and kicking off national reform, a decade of my staff, Minority Leader Brad Jones, Rep. Sheila Harrington, and most especially the 100s of people who came forward over the years to share their often outrageous experiences from camp counselors to tech in order to illustrate the urgent need for reform.