The Vermont Legislature kicked off 2019 with bill H.1, seeking to ban non-competes in the Green Mountain State. The new bill has been filed by Martin LaLonde, who promulgated an identical bill last January. The 2018 bill was read and referred to the Committee on Commerce and Economic Development and never made further progress. Rep. LaLonde has a new co-sponsor in 2019, Rep. Annmarie Christensen.
The bill, as drafted, seeks to prohibit all non-compete agreements in the employment context. There are three limited exceptions allowing for parties to enter into an agreement not to compete with a business or similarly restrain a person from engaging a profession, business, or trade, where the sale of a business or dissolution of a partnership or limited liability company is involved. The bill specifically notes that it does not “prohibit an agreement that prohibits the disclosure of trade secrets . . . .”
We will continue to closely monitor proposed legislation in Vermont and across the nation and report back with any updates.