Non Compete Agreement in Massachusetts

In Massachusetts, non-compete agreements are often a source of controversy, as they limit an employee’s ability to work in their chosen profession after leaving their current employer. These agreements are enforceable in Massachusetts but are subject to certain limitations and restrictions.

First and foremost, non-compete agreements in Massachusetts must be reasonable in scope and duration. The agreement cannot be too broad, preventing the employee from working in any capacity within their chosen field, nor can it be too long, preventing the employee from finding work for an unreasonable amount of time. The courts will consider factors such as the employee’s level of responsibility, the industry in which they work, and the geographic area in which the agreement applies when determining reasonableness.

Additionally, non-compete agreements must be supported by consideration, meaning that the employee must receive something in exchange for signing the agreement. This could be a signing bonus, additional compensation, or other benefits. The consideration must be reasonable and cannot be merely continued employment, as this would not provide the necessary incentive for the employee to sign.

It is also important to note that non-compete agreements are unenforceable in certain situations, such as when the employee is terminated without cause or laid off. If the employer breaches the agreement in any way, it may also be unenforceable.

Finally, it is worth mentioning that Massachusetts recently passed a law that will greatly limit the use of non-compete agreements in certain industries, including technology, healthcare, and life sciences. Starting in 2021, non-compete agreements will only be enforceable if the employee earns more than $80,000 annually or if they are classified as exempt under the Fair Labor Standards Act.

In conclusion, non-compete agreements are enforceable in Massachusetts but are subject to limitations and restrictions. Employers must ensure that their agreements are reasonable in scope and duration, supported by consideration, and not in violation of any laws or regulations. Employees should carefully review any non-compete agreements they are asked to sign to ensure that they are not overly restrictive and do not unfairly limit their ability to work in their chosen field.