2020 -- S 2087 | |
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LC003485 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2020 | |
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A N A C T | |
RELATING TO LABOR AND LABOR RELATIONS - NONCOMPETITION AGREEMENTS | |
- BROADCAST EMPLOYEES | |
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Introduced By: Senators Lombardi, Nesselbush, Ciccone, Conley, and McCaffrey | |
Date Introduced: January 21, 2020 | |
Referred To: Senate Judiciary | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Sections 28-59-2 and 28-59-3 of the General Laws in Chapter 28-59 |
2 | entitled "Rhode Island Noncompetition Agreement Act [Effective January 15, 2020]" are hereby |
3 | amended to read as follows: |
4 | 28-59-2. Definitions. [Effective January 15, 2020.] |
5 | As used in this chapter: |
6 | (1) "Associated broadcast entities" means entities that provide reporting services to |
7 | broadcast television or radio stations, including, without limitation, subcontractors that provide |
8 | weather, sports, traffic, and other reports for broadcast or cablecast; |
9 | (2) "Broadcast employee" means any employee of a broadcast industry employer, except |
10 | those employees whose services primarily include sales or management functions; |
11 | (1)(3) "Business entity" means any person as defined in § 43-3-6 and includes a |
12 | corporation, business trust, estate trust, partnership, association, joint venture, government, |
13 | governmental subdivision or agency, or any other legal or commercial entity. |
14 | (4) "Broadcast industry employer" means the owner or operator of one or more broadcast |
15 | television or radio stations, including any associated broadcast entity, but excluding cable stations |
16 | or cable networks; |
17 | (5) "Broadcast television or radio station" means an entity that is owned or operated |
18 | either by holding a Federal Communications Commission television or radio license for the |
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1 | station, or by operating a station through a local service, sales, marketing, or outsourcing |
2 | agreement; |
3 | (6) "Cable network" means an entity that distributes programming to two (2) or more |
4 | local cable systems; |
5 | (7) "Cable station" means an entity that produces or transmits programming to one or |
6 | more local cable systems; and |
7 | (2)(8) "Earnings" means wages or compensation paid to an employee in the first forty |
8 | (40) hours of work in a given week, not inclusive of hours paid at an overtime, Sunday, or |
9 | holiday rate. |
10 | (3)(9) "Employee" means an individual who works for hire, including an individual |
11 | employed in a supervisory, managerial, or confidential position, but shall not include an |
12 | independent contractor. |
13 | (4)(10) "Employer" means any person, business entity, partnership, individual |
14 | proprietorship, joint venture, firm, company, or other similar legal entity that employs one or |
15 | more employees, and shall include the state and its instrumentalities and political subdivisions, |
16 | public corporations, and charitable organizations. |
17 | (5)(11) "Forfeiture agreement" means an agreement that imposes adverse financial |
18 | consequences on a former employee as a result of the termination of an employment relationship, |
19 | regardless of whether the employee engaged in competitive activities, following cessation of the |
20 | employment relationship. Forfeiture agreements do not include forfeiture for competition |
21 | agreements. |
22 | (6)(12) "Forfeiture for competition agreement" means an agreement that by its terms or |
23 | through the manner in which it is enforced, imposes adverse financial consequences on a former |
24 | employee as a result of the termination of an employment relationship if the employee engages in |
25 | competitive activities. |
26 | (13) "Local cable system" means a cable system, as defined in 47 U.S.C. 522, as from |
27 | time to time amended, operating in the state. |
28 | (7)(14) "Low-wage employee" means an employee whose average annual earnings, as |
29 | defined in subsection (2), are not more than two hundred fifty percent (250%) of the federal |
30 | poverty level for individuals as established by the United States Department of Health and |
31 | Human Services federal poverty guidelines. |
32 | (8)(15) "Noncompetition agreement" means an agreement between an employer and an |
33 | employee, or otherwise arising out of an existing or anticipated employment relationship, under |
34 | which the employee or expected employee agrees that he or she will not engage in certain |
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1 | specified activities competitive with his or her employer after the employment relationship has |
2 | ended. Noncompetition agreements include forfeiture for competition agreements, but do not |
3 | include: |
4 | (i) Covenants not to solicit or hire employees of the employer; |
5 | (ii) Covenants not to solicit or transact business with customers, clients, or vendors of the |
6 | employer; |
7 | (iii) Noncompetition agreements made in connection with the sale of a business entity or |
8 | all or substantially all of the operating assets of a business entity or partnership, or otherwise |
9 | disposing of the ownership interest of a business entity or partnership, or division or subsidiary of |
10 | any of the foregoing, when the party restricted by the noncompetition agreement is a significant |
11 | owner of, or member or partner in, the business entity who will receive significant consideration |
12 | or benefit from the sale or disposal; |
13 | (iv) Noncompetition agreements originating outside of an employment relationship; |
14 | (v) Forfeiture agreements; |
15 | (vi) Nondisclosure or confidentiality agreements; |
16 | (vii) Invention assignment agreements; |
17 | (viii) Noncompetition agreements made in connection with the cessation of or separation |
18 | from employment if the employee is expressly granted seven (7) business days to rescind |
19 | acceptance; or |
20 | (ix) Agreements by which an employee agrees to not reapply for employment to the same |
21 | employer after termination of the employee. |
22 | (9)(16) "Trade secret" means information as defined in § 6-41-1. |
23 | 28-59-3. Enforceability. [Effective January 15, 2020.] |
24 | (a) A noncompetition agreement shall not be enforceable against the following types of |
25 | workers: |
26 | (1) An employee who is classified as nonexempt under the Fair Labor Standards Act, 29 |
27 | U.S.C. § 201-219; |
28 | (2) Undergraduate or graduate students who participate in an internship or otherwise |
29 | enter a short-term employment relationship with an employer, whether paid or unpaid, while |
30 | enrolled at an educational institution; |
31 | (3) Employees age eighteen (18) or younger; or |
32 | (4) A low-wage employee. |
33 | (b) No broadcast industry employer employment contract for the services of a broadcast |
34 | employee may contain a provision requiring that such broadcast employee: |
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1 | (1) Refrain from obtaining employment in a specified geographical area for a specified |
2 | period of time after termination of employment with that broadcast industry employer; |
3 | (2) Disclose the terms or conditions of an offer of employment, or the existence of any |
4 | such offer, from any other broadcast industry employer following the expiration of the term of the |
5 | employment contract; or |
6 | (3) Agree to enter into a subsequent employment contract with the broadcast industry |
7 | employer, or extend or renew the existing employment contract, upon the same terms and |
8 | conditions offered by a prospective employer. |
9 | (c) Any person who is aggrieved by a violation of this section may bring a civil action in |
10 | the superior court to recover damages, together with court costs and reasonable attorneys' fees. |
11 | (b)(d) This section does not render void or unenforceable the remainder of a contract or |
12 | agreement containing the unenforceable noncompetition agreement, nor does it preclude the |
13 | imposition of a noncompetition restriction by a court, whether through preliminary or permanent |
14 | injunctive relief or otherwise, as a remedy for a breach of another agreement or of a statutory or |
15 | common law duty. |
16 | (c)(e) Nothing in this section shall preclude an employer from entering into an agreement |
17 | with an employee not to share any information, including after the employee is no longer |
18 | employed by the employer, regarding the employer or the employment that is a trade secret. |
19 | (f) The provisions of this section shall apply to employment contracts entered into, |
20 | renewed, or extended on or after January 1, 2021. |
21 | SECTION 2. This act shall take effect upon passage. |
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LC003485 | |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO LABOR AND LABOR RELATIONS - NONCOMPETITION AGREEMENTS | |
- BROADCAST EMPLOYEES | |
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1 | This act would prohibit the inclusion of noncompetition agreements in broadcast industry |
2 | employment contracts that are entered into after January 1, 2021. |
3 | This act would take effect upon passage. |
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LC003485 | |
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