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Legislative Year: 2022 Change

Bill Detail: HB22-1317

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Title Restrictive Employment Agreements
Status Signed by the President of the Senate (06/06/2022)
Bill Subjects
  • Labor & Employment
House Sponsors K. Tipper (D)
Senate Sponsors J. Bridges (D)
House Committee Judiciary
Senate Committee Business, Labor and Technology
Date Introduced 03/24/2022

The bill declares that a restrictive employment agreement or
covenant not to compete that restricts the right of any person to receive
compensation for performance of labor for any employer is void, with
certain exceptions.
Additionally, if the employer provides proper notice of the
restrictive employment agreement or covenant not to compete to the
employee or prospective employee, the following agreements or
covenants are not prohibited:

  • A provision providing for recovery of the expense of
educating and training an employee who has served an
employer for a period of less than 2 years, unless the
education and training was primarily for the benefit or
convenience of the employer;
  • A reasonable confidentiality provision relevant to the
employer's business that does not prohibit disclosure of
information that arises from the employee's general
training, knowledge, skill, or experience, whether gained
on the job or otherwise, or information that is readily
ascertainable to the public; and
  • Agreements or covenants with a person earning annual
cash compensation greater than the threshold amount for
highly compensated employees.
The bill limits choice of law and choice of venue provisions in
restrictive employment agreements and covenants not to compete.
The bill prohibits an employer from entering into, presenting to an
employee or prospective employee as a term of employment, or
attempting to enforce any restrictive employment agreement or covenant
not to compete that is void under the bill. An employer who violates this
provision is subject to a penalty of $5,000 for each employee or
prospective employee, injunctive relief, and actual damages.

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with Amendments
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