Legislators at the state and federal levels have been focused on laws that, for the most part, restrict the use of non-compete agreements or modify existing trade secret provisions. Practitioners can track the progress of these proposals to stay aware of changes that may impact their clients in 2019.
Most of the recent bills being introduced focus on the legality of non-compete agreements. Of these, many of the proposals – including at the federal level – seek to restrict non-compete agreements among low wage workers. For example, bills in Hawaii prohibit non-compete agreements for those “whose earnings do not exceed the greater of the hourly rate equal to the minimum wage required by applicable federal or state law or $15 per hour.” In comparison, a bill introduced in Washington places a minimum earnings threshold on non-compete agreements – at $100,000 for employees and $250,000 for independent contractors. Other states have focused on the use of non-compete agreements in particular industries – ranging from physicians, to IT employees, as well as those in the oil and gas industry, and even broadcasters (the last of which became law in Utah last month).
While not nearly as popular as non-compete-focused legislation, a handful of states have also seen proposals related to trade secrets. A bill introduced in West Virginia, for example, would alter its version of the Uniform Trade Secrets Act, including by adding criminal penalties for trade secret theft.