New Rhode Island Law Limits Non-Compete Agreements

By Brian J. Lamoureux August 21, 2019Employment Law

Rhode Island recently joined a growing list of states with laws limiting the ability of employers to use non-compete agreements in the workplace. Employers often insist that employees sign non-compete agreements which would restrict an employee’s ability to work in the same field and geographic area as the employer for a limited period of time, such as six months to a year after the employment relationship ends. Although courts have always required such agreements to be limited in scope and reasonable in their effect, many employers continued to insist that their employees sign such agreements anyway, even if the terms were overly onerous on the employee.

This summer, the Rhode Island General Assembly passed the “Rhode Island Noncompetition Agreement Act” (Act). The Act is primarily aimed at protecting so-called “non-exempt” employees, graduate students, underage workers, and workers earning less than 250% of the poverty level (i.e., $31,225 for 2019). A non-exempt employee is generally one who is eligible for overtime, is paid hourly (not salary), and earns less than $455 per week. Clearly, the Act is intended to relieve lower-paid and younger workers from the effects of non-compete agreements and to permit non-compete agreements only where they are truly and reasonably necessary to protect an employer’s legitimate business interests, such as in connection with the sale of a business or where the employee is highly compensated.

However, the Act is not all bad news for employers. The new law does not apply to independent contractors. Also, it allows employers to insist that a former employee not solicit other employees, customers or clients or use the employer’s trade secrets. Employers should familiarize themselves with the Act and take a look at how they are using non-compete agreements to ensure compliance with the Act when it becomes effective in mid-January, 2020. For further information on this new law or other business or employment matters, please contact PLDO Partner Brian J. Lamoureux at 401-824-5100 or email bjl@pldolaw.com.

 

 

Disclaimer: This blog post is for informational purposes only. This blog is not legal advice and you should not use or rely on it as such. By reading this blog or our website, no attorney-client relationship is created. We do not provide legal advice to anyone except clients of the firm who have formally engaged us in writing to do so. This blog post may be considered attorney advertising in certain jurisdictions. The jurisdictions in which we practice license lawyers in the general practice of law, but do not license or certify any lawyer as an expert or specialist in any field of practice.

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Brian J. Lamoureux is a Partner with Pannone Lopes Devereaux & O'Gara LLC and a member of the Employment Law, Cyber Law, Litigation and Corporate & Business Teams. He is also Practitioner Faculty in Management (Business Law) at Providence College, his alma mater.

His extensive practice areas include complex commercial litigation, employment law, construction law, social media law, and creditors' rights. In addition to being an accomplished business litigator, he has developed into a nationally-recognized voice on cutting-edge legal issues relating to social media. He is a frequent presenter, published author, and broadcast commentator on the topic and regularly appears on WPRI-TV, NBC10 and NECN-TV, the nation's largest 24-hour regional news network. His recent newspaper columns and articles include Social Media Privacy Law Impacts EmployersShould Employees Use Facebook at Work?Privacy Rights Being Tested in the Digital AgeDigital Age Hiring Process Filled With DangerTexting in the Workplace? Dangers Abound, Email Privacy Not a Guarantee in Workplace, and Worry About Workplace Prejudice? Clean Up. Mr. Lamoureux's work has also been published in the Providence Business News and Rhode Island Lawyers Weekly.

He successfully briefed and argued before the First Circuit Court of Appeals in a case confirming surety's rights to indemnification. He was lead counsel in a successfully resolved certified class action regarding the demutualization of an insurance company before the U.S. Bankruptcy Court for the District of Rhode Island, and served as trial co-counsel in one of the largest defense jury verdicts in the Federal District Court in Massachusetts.

Mr. Lamoureux has been honored for his achievements by the Providence Business News and was selected as a member of its 2011 Class of "40 Under Forty."

He earned his J.D., magna cum laude, from the Syracuse University College of Law, where he was a member of the Syracuse Law Review and Moot Court Honor Society. At the same time, he received a Master of Public Administration from the Maxwell School of Citizenship and Public Affairs. He also holds a Master of Arts degree in Political Science from the University of Rhode Island, where he was a teaching assistant in American Government and International Relations, and a B.A. in Political Science, cum laude, from Providence College.

Prior to joining PLDO, Mr. Lamoureux was a litigation partner in a large international AMLaw 200 firm. He is admitted to practice in state and federal courts in Rhode Island and Massachusetts, and is qualified to serve as a receiver in Rhode Island Superior Court. Mr. Lamoureux is also admitted to practice before the U.S. Supreme Court. To reach Attorney Lamoureux, please call 401-824-5100 or email bjl@pldolaw.com.

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