Over the past 10–15 years, we have seen an explosion of legislative activity related to restrictive covenants. This activity is happening not only in state legislatures but on the federal level as well. While each proposal is different, we've certainly seen trends emerge, including required notice provisions, fee shifting, and choice of law and venue requirements.
One of the most prevalent trends is the move towards banning non-competes (and sometimes, other restrictive covenants) for so-called "low-wage workers." To date, 10 states have implemented a low-wage ban of sorts: Illinois, Maryland, Maine, Massachusetts, Oregon, Nevada, New Hampshire, Rhode Island, Virginia, and .1
Notably, it's not just blue states moving in this direction. Soon to join their ranks? Iowa and West Virginia, possibly. In Iowa, the Republican legislature is considering a bill that would prohibit the use of non-competes with employees who earn "an average monthly wage that is less than or equal to" $14.50 per hour. This prohibition would not apply to non-solicitation agreements, confidentiality agreements, or agreements prohibiting the use or disclosure of trade secrets or inventions. This bill has already passed the state senate.
In West Virginia, the legislature is mulling a bill that would go even farther. This bill would prohibit and render unenforceable "restrictive employment agreements" where an employee's pay is less than the annual mean wage of employees in West Virginia as determined by...
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