Bill Text: NY S05790 | 2019-2020 | General Assembly | Introduced
Bill Title: Prohibits non-compete agreements and certain restrictive covenants which unreasonably and unfairly bar or inhibit post-employment competition and protects certain workers from inappropriate and unnecessary restrictions on future employment.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced - Dead) 2020-01-08 - REFERRED TO LABOR [S05790 Detail]
Download: New_York-2019-S05790-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 5790 2019-2020 Regular Sessions IN SENATE May 15, 2019 ___________ Introduced by Sen. RAMOS -- (at request of the Attorney General) -- read twice and ordered printed, and when printed to be committed to the Committee on Labor AN ACT to amend the labor law, in relation to prohibiting non-compete agreements and certain restrictive covenants The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. The labor law is amended by adding a new section 191-d to 2 read as follows: 3 § 191-d. Non-compete agreements. 1. For the purposes of this section, 4 the term: 5 a. "Non-compete agreement" means an agreement, or clause contained in 6 an employment contract, between an employer and an employee that prohib- 7 its or restricts such employee from obtaining employment, after the 8 conclusion of employment with the employer included as a party to the 9 agreement: 10 (i) for a specified period of time; 11 (ii) in any specified geographical area; and/or 12 (iii) with any particular other employer or in any particular indus- 13 try. 14 b. "Covered employee" means any employee whose earnings are less than 15 seventy-five thousand dollars annually. This threshold shall be annually 16 increased, where warranted by application of the below-described formu- 17 la, pursuant to a percentage to be determined by reference to the 18 consumer price index, published by the United States Bureau of Labor 19 Statistics, for the applicable calendar year. Said percentage shall 20 equal fifty percent of the annual inflation, as determined from the 21 increase in the consumer price index in the one-year period ending on 22 March thirty-first prior to the cost-of-living adjustment effective on 23 the ensuing September first. Said percentage shall then be rounded up to 24 the next higher one-tenth of one percent and shall not exceed three EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD07440-01-9S. 5790 2 1 percent. If the percentage increase would be less than one percent, the 2 threshold shall not increase. 3 2. No employer or its agent, or the officer or agent of any corpo- 4 ration, partnership, or limited liability company, shall seek, require, 5 demand or accept a non-compete agreement from a covered employee. 6 3. For all employees other than covered employees, no employer or his 7 or her agent, or the officer or agent of any corporation, partnership, 8 or limited liability company, shall seek, require, demand or accept a 9 non-compete agreement from any employee unless the non-compete agreement 10 meets the following requirements: 11 a. It shall be in writing and signed by the employer and employee. 12 b. It shall be provided to a prospective employee by the earlier of a 13 formal offer of employment or thirty days before the non-compete agree- 14 ment goes into effect. 15 c. If a current employee is not subject to a non-compete agreement, 16 any new non-compete agreement must be provided at least thirty days 17 before the agreement becomes effective. 18 4. If an employee subject to a non-compete agreement is discharged 19 without cause, the non-compete agreement is no longer enforceable as to 20 that employee. 21 5. a. An employee, including a covered employee, may bring a civil 22 action in a court of competent jurisdiction against any employer or 23 persons alleged to have violated this section. An employee shall bring 24 such action within two years of the later of: (i) when the prohibited 25 non-compete agreement was signed; (ii) when the employee learns of the 26 prohibited non-compete agreement; (iii) when the employment relationship 27 is terminated; or (iv) when the employer takes any step to enforce the 28 non-compete agreement. The court shall have jurisdiction to void any 29 such non-compete agreement and to order all appropriate relief, includ- 30 ing enjoining the conduct of any person or employer; ordering payment of 31 liquidated damages; and awarding lost compensation, damages, reasonable 32 attorneys' fees and costs. 33 b. For the purposes of this subdivision, liquidated damages shall be 34 calculated as an amount not more than ten thousand dollars. The court 35 shall award liquidated damages to every employee affected under this 36 section, in addition to any other remedies permitted by this section. 37 c. The court shall also award a consideration payment if the employer 38 did not provide such payment when due. 39 6. The provisions of this section shall not apply to employees 40 covered under section two hundred two-k of this chapter. 41 § 2. Severability clause. If any clause, sentence, paragraph, subdivi- 42 sion, section or part of this act shall be adjudged by any court of 43 competent jurisdiction to be invalid, such judgment shall not affect, 44 impair, or invalidate the remainder thereof, but shall be confined in 45 its operation to the clause, sentence, paragraph, subdivision, section 46 or part thereof directly involved in the controversy in which such judg- 47 ment shall have been rendered. It is hereby declared to be the intent of 48 the legislature that this act would have been enacted even if such 49 invalid provisions had not been included herein. 50 § 3. This act shall take effect on the one hundred eightieth day after 51 it shall have become a law.