An Update on Noncompete Legislation Following Passage of Massachusetts' Non-Compete Law
In October 2018, businesses across the country braced for the effects of a noncompete law that was enacted in Massachusetts. The "garden leave" clause in Massachusetts' noncompete law dictated that during the period in which a departed employee is prohibited from working for a competitor, the previous employer must compensate the departed employee with at least 50% of his or her salary. However, compromise language added to the final version of the law permits "mutually-agreed upon consideration" to be substituted for the "garden leave" compensation.
Since Massachusetts enacted its statute, several other jurisdictions have created or amended noncompete laws. Much of the legislation invalidates noncompete agreements as contrary to public policy, particularly with respect to low-wage workers, or creates significant limits on enforceability.
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