Let Freedom Ring–Happy July 4th

May the sun in his course visit no land more free, more happy, more lovely, than this our own country! ~Daniel Webster We have exciting news at Foley & Foley, PC –Attorney Mikaela McDermott will join our team July 12, 2016. She brings years of experience in public and private sector employment and labor law. She will make our strong team even stronger. The Massachusetts legislature has been busy. Two bills that will impact employers are still in the works and may land on the Governor’s desk soon: Noncompete reform The Massachusetts House passed a comprehensive noncompete reform bill on June 29, 2016. Because the Senate passed a fairly similar measure last year, the bill is expected to be approved by the Senate before the session closes on July 31, 2016. Whether Governor Baker will sign the bill is unknown at this time. The major changes: By far the most significant change would introduce what is referred to as a “Garden Leave” clause requirement. Under the current version of the law, employers would have a choice of paying either 50% of the employee’s salary for the length of the non-compete or “other mutually-agreed upon consideration… .” Noncompete period is limited to 12 months in duration unless the employee has breached a fiduciary duty or taken property, in which case 24 months is allowed; Noncompetes are not allowed for several categories of workers: Employees terminated for cause or laid off; Non-exempt (OT eligible) employees; Ages 18 or younger; and Undergraduate or graduate interns. Noncompete must include a right to consult with counsel before signing, and must be provided to the employee by a formal offer or 10 business days before the start date, whichever is earlier. Any noncompete entered during employment must be supported by additional consideration beyond continued employment. A court may not strike out unlawful provisions of a noncompete in violation of this law–the entire agreement will be invalid, which is not the practice now. Should this bill become law many current noncompetes in Massachusetts will need to be rewritten. Pay Equity The Senate Bill Proposal – 2119 “An Act to Establish Pay Equity” is gaining momentum. Attorney Mike Foley recently presented on this topic at a Government Affairs Committee of the New Bedford Chamber of Commerce – more about his presentation Here is the bottom line: For decades, it has been illegal in the United States for an employer to discriminate against women, including discrimination against women in terms of compensation. In Massachusetts, employees who believe that they are underpaid on the basis of their gender currently have recourse to four statutes when seeking relief: The Federal Equal Pay Act (FEPA); Title VII of the Civil Rights Act of 1964 (Title VII); The Massachusetts Equal Pay Act (MEPA); and Chapter 151B of the General Laws of Massachusetts (151B). Depending upon your perspective, here are the highlights or low lights regarding the pending pay equity law: Significantly changes the definition of “comparable work” under MEPA. That critical phrase under the proposed law “shall solely mean work that is substantially similar that it requires substantially similar skill, effort and responsibility and is performed under similar working conditions.. .” The key question is how will this impact merit pay, commission pay and any pay system that is not seniority driven. It would become unlawful for an employer to seek the salary history of any prospective employee. Employers could not prevent employees from disclosing their wages, benefits or other compensation or inquiring about or discussing the wages of any other employee. There is more to this far ranging bill and we will, of course, keep you informed. As always, please contact us with any concerns or questions. We can help.

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The Defense Against Trade Secrets Act: what does it means for you?

This month, President Obama signed into law the most significant trade secret reform in nearly twenty years: the Defend Trade Secrets Act of 2016 (DTSA).  The Act received enormous bipartisan support, illustrating how significant this issue is to business. How does the Act impact your workplace?

Historically, trade secret protection has been the exclusive domain of the states. In fact, the DTSA does not pre-empt state law but adds an additional level of federal protection for trade secret holders. Specifically, the Act allows a federal cause of action to obtain a civil seizure order and remedies for trade secret theft. If a showing of “extraordinary circumstances” is met, a federal court can issue an ex parte property seizure—a powerful tool to stop misappropriation. The Act specifies how a trade secret threshold is met, and refers to “reasonable measures” to keep the information secret.  Moreover, the Act requires the information sought to be protected derives “independent economic value” for the owner(s).  The federal remedies are welcome but the burden of establishing information as a trade secret is high.

The best way to protect business secrets to avoid a breach and to seek federal and state protection after a breach is:

1. Identify and continually protect trade secrets;
2. Establish steps to maintain secrecy;
3. Develop a comprehensive Protection Plan;
4. Periodically audit your security measures.

Most importantly, the DTSA requires that employers must now provide a notice of whistle blower immunity protection in any contract or agreement with an employee (or an independent contractor or consultant).

We can help. Our lawyers have vast experience assisting businesses with trade secret matters.  Contact us at info@foleylawpractice.com or call 508.548.4888

Mass. Lawmaker Seeks to Limit Non-Competes

In a speech this week, House Speaker Robert A. DeLeo promised a new bill putting limits on the use of non-compete agreements. While the bill has yet to be released, Speaker DeLeo stated that non-compete agreements should be no more than 12 months; employers must notify applicants about non-competes before a job offer is accepted; and restrictions on employment of low wage earners would be banned. Should the bill pass, this would be a major change for employers who seek to protect their interests.

Restrictions on employment have long been lamented by the high-tech sector.  The claim by tech and startup groups is such restrictions hamper innovation and limit the pool of talented workers.  Some states have successfully  limited non-compete restrictions and California has largely eliminated the practice.  Of course, many businesses feel strongly that a non-compete agreement is the best way to prevent workers from taking valuable trade secrets and company practices with them.  We agree and have drafted hundreds of these contracts, which require thorough knowledge of the controlling law in order to work.

The timing of the release of the bill is unclear.  We will keep you updated. If you have any questions on non complete agreements or any other workplace issues, we can help.