Non-compete agreements - Massachusetts

Summary of differences between federal and state regulations

Affecting non-compete agreements entered into on or after October 1, 2018, a new law defines minimum standards for agreements to be enforceable, banning those that do not meet the requirements. To be considered legitimate, an agreement must be made in writing and signed by both the employer and employee. It must also be provided at the time a job offer is made or 10 days before work starts (agreements for current employees become effective 10 days after they are provided). The law also limits non-competes to a duration of 12 months.

New agreements must include a “garden leave” clause, which requires the employer to provide 50% of the employee’s salary during the restricted period unless another “mutually agreed upon consideration” is in place within the agreement.

Non-compete agreements are completely banned for the following groups:

• Employees classified as nonexempt under the Fair Labor Standards Act (FLSA).
• Part-time undergraduate and graduate students.
• Workers who are laid off or terminated without cause.
• Minors 18 or younger

State

Contact

Department of Labor & Workforce Development

Regulations

Massachusetts Title XVI Chapter 112
Section 12X Restrictive covenants upon physicians rendered unenforceable
Any contract or agreement which creates or establishes the terms of a partnership, employment, or any other form of professional relationship with a physician registered to practice medicine pursuant to section two, which includes any restriction of the right of such physician to practice medicine in any geographic area for any period of time after the termination of such partnership, employment or professional relationship shall be void and unenforceable with respect to said restriction; provided, however, that nothing herein shall render void or unenforceable the remaining provisions of any such contract or agreement.

https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXVI/Chapter112/Section12x

Federal

Contact

Department of Labor

Regulations

None.