The Non-Competitor Act would not apply to agreements with independent contractors. In addition, the bill excludes other types of agreements, including non-speech, non-mentions, invention orders, competition contracts with the sale of a business or essentially all of a company`s assets, non-competitive agreements outside the employment relationship, expiry agreements, agreements that do not apply to return to employment after termination of employment and termination agreements , provided the worker has seven working days to cancel the acceptance. It may seem simple enough, but a closer look at the new legislation reveals an involuntary complexity that is likely to create confusion. The central question is: does the new law invalidate non-competition prohibitions that completely or partially prevent a low-wage employee from working competitively? Given the diversity of restrictions on the application of restrictive agreements, lawyers should consider advising their professional clients when reviewing boarding procedures in the implementation of non-compete agreements, re-examining the use of separation forms with outgoing workers, and considering a review of multi-level agreements to ensure that they correspond to the jurisdictions for which they may be used. In recent weeks, Maine and New Hampshire have passed a law prohibiting the use of a low-wage non-compete clause. Shortly thereafter, on July 11, 2019, the Rhode Island legislature sent a similar bill for signature to Governor Raimondo`s office. While employers often make job offers for potential workers in a written letter of offer, it is also common for employers (especially small employers) to make less formal job offers, including orally. In both cases, employers (large and small) often did not give potential workers a copy of the non-compete bans that workers must sign before the first working day. Sometimes, in letters of offer, employers have advised aspiring workers that they must sign a non-compete clause on the first day of work, but it is just as common, if not more often, that employers simply do not notify potential workers. July 10, 2019, New Hampshire amended its Non-Competition Act and ordered: Any non-compete agreement between an employer and a low-wage worker is null and void.3 The amendment (SB 197) defines low-wage workers as people earning an hourly rate of 200% or less than the federal minimum wage (i.e.
workers who currently earn US$14.50 or less per hour or about US$30,160 per hour) year).