MGL c.149, § 24L Massachusetts Noncompetition Agreement Act
These laws ban noncompetition agreements for certain professions:
Executive Order on promoting competition in the American economy, Executive Office of the President, 2021.
"(g) To address agreements that may unduly limit workers’ ability to change jobs, the Chair of the FTC is encouraged to consider working with the rest of the Commission to exercise the FTC’s statutory rulemaking authority under the Federal Trade Commission Act to curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility." (Factsheet)
Selected case law
All Stainless, Inc. v. Colby, 364 Mass. 773 (1974)
"A covenant not to compete contained in a contract for personal services will be enforced if it is reasonable, based on all the circumstances."
Automile Holdings, LLC v. McGovern, 483 Mass. 797 (2020)
An "anti-raiding" restrictive covenant is “only reasonable, and thus enforceable, if it is (1) necessary to protect a legitimate business interest, (2) reasonably limited in time and space, and (3) consonant with the public interest.”
Boulanger v. Dunkin' Donuts, Inc., 442 Mass. 635 (2004)
Under the circumstances, "covenants not to compete signed by the plaintiff as part of his franchise agreements with the defendant were enforceable."
F. A. Bartlett Tree Expert Company vs. Barrington, 353 Mass. 585 (1968)
This case sets the standard for the material change doctrine "where it appeared that after working under that contract for some years the salesman's remuneration and sales area were changed substantially..."
New England Tree Expert Co., Inc. v. Russell, 306 Mass. 504 (1940)
"It is settled in this Commonwealth that such contracts are divisible and will not be enforced as to any parts of the covenant that are not reasonably necessary for the protection of the good will of the employer's business. ... What is reasonable depends upon the facts in each case."
Novelty Bias Binding Co. v. Shevrin, 342 Mass. 714 (1961)
"It has been long settled in this Commonwealth that a covenant inserted in a contract for personal service restricting trade or competition or freedom of employment is not invalid and may be enforced in equity provided it is necessary for the protection of the employer, is reasonably limited in time and space, and is consonant with the public interest. What is reasonable depends on the facts in each case."
Richmond Brothers, Inc. v. Westinghouse Broadcasting Co., Inc., 357 Mass. 106 (1970)
An employer isn’t entitled to protection from ordinary competition.
Employee noncompetition laws and practices: A Massachusetts paradigm shift goes national, Massachusetts Law Review, Vol. 103, No. 2, June 2022.
Fair competition law, Beck Reed Riden LLP.
This source keeps close tabs on noncompetition law changes across the country and especially Massachusetts. Includes 50-state surveys, and The Changing Landscape of Trade Secrets Laws and Noncompete Laws Around the Country.
HRMA Perspectives publishes “The Supreme Judicial Court and the new law imposing restrictions on non-compete agreements in Massachusetts”, Bowditch, October 2018.
Detailed summary of the provisions of the 2018 Massachusetts law.
Massachusetts noncompete law blog, Foley Hoag.
"[F]ocuses on developments in Massachusetts in the areas of covenants not to compete, non-solicitation and non-disclosure agreements, trade secrets and the many related issues that arise when employees move between employers."
Non-compete clause rulemaking, FTC, January 5, 2023.
The Federal Trade Commission proposes preventing employers from entering into non-compete clauses with workers and requiring employers to rescind existing non-compete clauses. Comment here. Deadline March 20, 2023.
Non-competes in the workplace: Examining antitrust and consumer protection issues, FTC.
Includes video, transcripts and related resources.
Business torts in Massachusetts, 2nd ed., MCLE, loose-leaf. Chapter 8.
Drafting employment documents in Massachusetts, 4th ed., MCLE, loose-leaf. Chapter 5, Restrictive covenants and protection of trade secrets. Includes sample agreements.
Employee noncompetition law, West and Westlaw.
Massachusetts employment law, 5th ed., MCLE, loose-leaf. Chapter 24.
What to do about personnel problems in Massachusetts, BLR, loose-leaf, Vol. 1, p. E38-39. Helpful summary of the law.
|Last updated:||January 23, 2023|