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2018 Massachusetts Law on non-competition agreements for employees/independent contractors

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On October 1, 2018 the law in Massachusetts concerning non-competition agreements for employees/independent contractors changed dramatically. If your business uses non-competition agreements it is almost certain that your current forms will not be effective for new hires/independent contractors.

Among other things, the new law requires that post-October 1 non-competition agreements:

  • Must be limited to 12 months,
  • Must be provided to new hires/independent contractors at least 10 business days before the commencement of the relationship,
  • Must expressly state that the employee/independent contractor has the right to consult with counsel prior to signing, and
  • Must provide that the employee/independent contractor will be paid by the former employer during the period of non-competition. The payments must be either 50% of his salary or “other valuable consideration” – a term which will undoubtedly be the subject of litigation as earlier versions of the bill had required that the other consideration be at least as valuable as 50% of the salary, but the version signed into law used only the phrase other valuable consideration.

The above is by no means a complete statement of the law. It is intended only to demonstrate just how dramatic some the changes are.

If you would like more information, please do not hesitate to call.

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