Non-compete agreements have been a hot topic in employment law, heavily debated for their impact on employees’ rights and future employment prospects. These agreements, which restrict workers from joining competitors or starting their own business for a set period after leaving a job, can have notable implications for professionals across the board. While employers argue that non-competes protect trade secrets and client relationships, critics claim that they unfairly limit job opportunities and suppress wages.
In Massachusetts, these clauses have gained notable attention, as the state has enacted multiple laws and regulations that affect the enforceability of non-compete agreements. Understanding the basics of these agreements and how they may affect you, as the employee, and your future work opportunities is a must.
What is a Non-Compete Agreement?
A non-compete agreement is a contract between an employer and an employee that prevents the employee from engaging in certain competitive activities after the employment relationship ends. Oftentimes, these agreements prohibit the employee from working for competitors, starting a business, or, in the case of a non-solicitation provision, soliciting the company’s customers or clients for a set period and within a specific geographic area.
These agreements are typically used to protect the employer’s confidential information, trade secrets, and customer relationships, but they can noticeably limit an employee’s future prospects. Given these drawbacks, these clauses can become a concern for employees.
Are Non-Compete Agreements Enforceable in Massachusetts?
The enforceability of non-competes in Massachusetts has evolved over the years. In years past, these agreements were enforceable to a great extent, but in the last several decades, there have been growing concerns about their potential to unfairly restrict an employee’s ability to earn a living.
In response to this shift, the Massachusetts Non-Compete Agreement Act was enacted in 2018. This regulates the enforceability of non-compete agreements and offers extra protection to employees. While the non-compete agreements are still enforceable under this statute, they come with important limitations.
Notable Provisions of Massachusetts’ Non-Compete Agreement Law
Massachusetts’ non-compete agreement law clearly defines multiple provisions, including:
Restrictiveness and Reasonableness
In Massachusetts, non-compete clauses must be reasonable in terms of duration, geographic scope, and the nature of the work it seeks to restrict. If an issue arises, Courts usually evaluate whether the non-compete agreement is actually necessary to protect legitimate interests and whether it is excessively restrictive.
Prohibition of Enforcement for Low-Wage Employees
Under the Massachusetts Non-Compete Agreement Act, employers cannot enforce non-compete agreements for employees who earn equal to or less than the state’s minimum wage. If an employee’s weekly earnings fall below the state’s minimum wage threshold, which, as of 2025, is set at $1,250 per week, employers can’t enforce a non-compete.
Notice Requirement
The state requires employers to provide employees with a non-compete agreement at least 10 days before the employee’s start date. If the employee has already started working when the employer introduces the agreement, the employee must be given a 10-day notice period.
The agreement must be in writing and should clearly outline the employee’s responsibilities, the restrictions imposed, and the consequences of violating the terms of the contract.
Limits on Duration
Massachusetts employers may only restrict an employee in a non-compete for one year after their employment. The Massachusetts Non-Compete Agreement Act limits the duration, although a longer duration may be enforced if the agreement is supported by additional consideration, such as an increase in compensation or a promotion.
Enforceability and Exceptions
Non-competes are subject to judicial scrutiny. In situations when they’re called into question, courts will evaluate whether the agreement serves a legitimate purpose and is not overly broad or oppressive.
Specific exceptions to enforcement apply, particularly if the employee was terminated without cause or laid off. In these situations, the non-compete agreement may be rendered unenforceable.
Garden Leave Clause
The garden leave clause in Massachusetts requires employees to stay away from work during their notice period while still receiving salary and benefits. Under the Massachusetts Noncompetition Agreement Act (MNAA) (2018), employers enforcing a non-compete must pay at least 50% of the employee’s highest base salary or other agreed compensation. In other words, if the non-compete provision is for one year, the employer must pay six months of pay to the employee for them to “sit out.” The employer can typically decide not to enforce the non-compete clause, meaning that they don’t have to pay the garden leave but also meaning that the employee does not have to sit out. Finally, if the non-compete clause does not contain the garden leave language, then the non-compete clause is likely not valid and can be void.
Notable Non-Compete Agreement Restrictions in Massachusetts
Massachusetts restricts certain areas of non-competes, including:
Geographic Restrictions
Employers often specify set areas where an employee is prohibited from engaging in competitive work. State courts will generally enforce these geographic restrictions provided they are reasonable in relation to the employer’s legitimate business interests.
For example, the courts may view a geographic restriction covering a single city as reasonable. However, one that prohibits work in an entire region might be considered overly broad.
Prohibition on Soliciting Clients
Solicitation is a common area that non-competes cover (with a non-solicitation clause), often stating that employees cannot solicit the employer’s clients or customers after leaving the company. This clause is typically enforceable, but employers must tailor it carefully to ensure it protects their legitimate interests without unduly limiting the employee’s ability to work.
An employer cannot use a non-compete clause to prevent a former employee from using their general professional skills or relationships they developed while working for the employer.
Protection of Trade Secrets and Confidential Information
Employers usually use non-competes to protect proprietary information, such as client lists, trade secrets, and business plans. For the most part, these agreements are enforceable if they are directly related to protecting confidential information, particularly in industries where intellectual property is a significant asset.
Competition Within the Same Industry
Non-compete agreements in Massachusetts may also impose restrictions on working for a direct competitor within the same industry. Courts typically evaluate these agreements based on the employee’s previous role at the company, the nature of the competitive activity, and the employer’s legitimate interests.
How Non-Compete Agreements Affect Massachusetts Employees
Non-compete agreements have benefits and drawbacks for both the employer and employee. On one hand, they can provide employers with a level of protection for their intellectual property and business interests. On the other hand, they can notably limit employees’ future employment opportunities.
For an employee, a non-compete agreement might limit their ability to seek employment in their chosen field. If the restrictions are too broad or downright unreasonable, the agreement could effectively bar them from continuing their career in the same industry or geographic area. This could lead to a loss of income and career development opportunities.
On top of that, an employee bound by a non-compete may find themselves in a situation where they must choose between violating the agreement and accepting a lower-paying job or a position outside of their desired field. For many employees, the restrictive nature of these agreements can create uncertainty and anxiety about their long-term career prospects.
Because of the potential impact of these agreements, it’s important to navigate them carefully and ensure that you understand what you’re agreeing to before signing.
Need Help Negotiating Your Non-Compete Agreement? Contact Our Team at the Fogelman Law Firm Today!
Non-compete agreements in Massachusetts are enforceable, provided they meet certain criteria. Massachusetts law imposes specific restrictions on the enforceability of these agreements, particularly when it comes to low-wage employees, duration, and geographic limitations.
If you’re an employee in Massachusetts and have concerns about a non-compete agreement, contact our skilled employment lawyers at the Fogelman Law Firm. We can help you understand your rights, evaluate the enforceability of the agreement, and explore your legal options. Contact us today at (617) 559-1530 or complete our online contact form to start today.
