Over the course of the past several years, several states have banned or severely restricted the ability of businesses to bind low-wage workers to post-employment restrictive covenants. Since 2007, Oregon has banned non-compete agreements for all employees except those who are exempt (as defined by the state’s overtime payment statute) and whose annualized compensation at the time of termination exceeds the median income of a four-person family, as determined by the United States Census Bureau for the most recent year available at the time of the employee’s termination ($56,119 per year based on most currently-available data). In 2016, Illinois passed a statute banning non-compete agreements with low-wage workers (defined in Illinois to be non-governmental workers making less than the greater of the prevailing federal, state, or local minimum wage or $13 per hour). In 2018, contained within a wider-ranging non-compete bill, Massachusetts also banned employers from entering into non-compete agreements with non-exempt employees, as those employees classification is defined by the Fair Labor Standards Act (“FLSA”), as well  as employees under age 18, paid or unpaid student interns, or other short-term student employees who are enrolled in school.

While such legislation trickled out over the last several years, 2019 has seen five additional states enact prohibitions on utilizing non-compete agreements for certain low-wage employees, with at least seven other states and the District of Columbia considering similar non-compete legislation.


Continue Reading Is It Time to Reconsider Your Non-Compete Policy? It Might Be If You Employ Low-Wage Workers

Washington state has joined the ranks of an ever-growing number of states that impose significant restrictions on employee non-compete agreements. On May 9, 2019, Governor Jay Inslee signed House Bill 1450, titled “An Act Relating to restraints, including noncompetition covenants, on persons engaging in lawful professions, trades, or businesses,” into law. The Act will go into effect on January 1, 2020. We reported on the bill in detail in March.

This change to Washington law is significant. Businesses with employees or independent contractors in the state should revisit their non-compete agreements and take the necessary steps to ensure compliance with the Act by the end of this year. Among other things:
Continue Reading Washington State Governor Signs Law Severely Limiting Non-Competes

As readers of this blog well know, there is a growing trend of state legislatures seeking to limit or outright ban non-competes. (See here, here, and here as just a few examples of state efforts to curb non-competes—not to mention the proposed federal legislation and international efforts—in the last six months.) Last week, the Washington Senate jumped on the bandwagon by passing a bill with a 30–18 vote that would severely limit the enforceability non-competes. (Similar efforts failed last year, as we reported here.)  Some of the key features of this year’s bill are as follows:
Continue Reading Washington State Lawmakers Seek to Partially Ban Non-Competes

We reported yesterday that the attorneys generals of ten states are investigating several fast food franchisors for their use of so-called “no poach” provisions in their franchise agreements.  Well, less than twenty-four hours later, the New York Times has reported that seven fast food franchisors (mostly different ones than those who received the information demands

For the third year in a row, the Washington state legislature failed to pass non-compete legislation, declining to take action on two separate bills that would have severely restricted employers’ ability to enforce former employees’ non-competition agreements.
Continue Reading Washington State’s Legislature Rains on Non-Compete Critics’ Parade Yet Again

shutterstock_155087132Where a freely negotiated contract between two sophisticated companies included a provision barring an award of monetary relief for breach of contract, the court will enforce the provision as written and award no economic damages.  CH2O, Inc. v. Meras Engineering, Inc., No. 45728-8-II (Wash. App. Court, July 21, 2015) (unpublished opinion).

Status of the

Untitled-1As directed by the court of appeals, a district court judge reconsidered his denial of a non-compete covenant case injunction but reached the same result on reconsideration.  He also stated why he would not have extended the covenant’s expiration date even if he had been inclined to enter the injunction.  Ocean Beauty Seafoods LLC v.

Several ex-employees now may compete with their former employer, and may solicit its employees and customers, after a federal judge in the Eastern District of Washington held that the restrictive provisions in their employment agreements are unenforceable. 

The agreements, drafted by the former employer, contained a choice-of-law provision which the former employer tried unsuccessfully to

(N.B.: Neither the author, this article, nor this blog intends to make, nor makes, any comments for or against the legalization of marijuana in any jurisdiction.)

What happens when you mix animal affection with a political issue? A Constitutional Convention? Tax dollars for pet shelters? Would you believe…trade secret litigation?

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By Robert Milligan and Joshua Salinas

As part of our annual tradition, we are pleased to present our discussion of the top 10 developments/headlines in trade secret, computer fraud, and non-compete law for 2013. Please join us for our complimentary webinar on March 6, 2014, at 10:00 a.m. P.S.T., where we will discuss them in