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S03100 Summary:

Add 191-d, Lab L
Prohibits non-compete agreements and certain restrictive covenants; authorizes covered individuals to bring a civil action in a court of competent jurisdiction against any employer or persons alleged to have violated such prohibition.
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S03100 Actions:

05/23/20231ST REPORT CAL.1335
05/24/20232ND REPORT CAL.
06/07/2023referred to codes
06/20/2023substituted for a1278b
06/20/2023ordered to third reading rules cal.484
06/20/2023passed assembly
06/20/2023returned to senate
12/22/2023VETOED MEMO.133
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S03100 Text:

                STATE OF NEW YORK
            Cal. No. 1335
                               2023-2024 Regular Sessions
                    IN SENATE
                                    January 27, 2023
        Introduced  by  Sens.  RYAN,  JACKSON,  MAYER  -- read twice and ordered
          printed, and when printed to be committed to the Committee on Labor --
          reported favorably from said committee, ordered to  first  and  second
          report,  ordered  to  a  third reading, amended and ordered reprinted,
          retaining its place in the order of third reading
        AN ACT to amend the labor law, in relation  to  prohibiting  non-compete
          agreements and certain restrictive covenants
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. The labor law is amended by adding a new section  191-d  to
     2  read as follows:
     3    §  191-d. Non-compete agreements. 1. For the purposes of this section,
     4  the term:
     5    (a) "non-compete agreement" means any agreement, or  clause  contained
     6  in  any  agreement,  between  an  employer and a covered individual that
     7  prohibits or restricts such covered individual  from  obtaining  employ-
     8  ment, after the conclusion of employment with the employer included as a
     9  party to the agreement; and
    10    (b)  "covered  individual"  means any other person who, whether or not
    11  employed under a contract of employment, performs work or  services  for
    12  another  person  on such terms and conditions that they are, in relation
    13  to that other person, in a position of economic dependence on, and under
    14  an obligation to perform duties for, that other person.
    15    2. No employer or its agent, or the officer or  agent  of  any  corpo-
    16  ration,  partnership,  limited liability company, or other entity, shall
    17  seek, require, demand or accept a non-compete agreement from any covered
    18  individual.
    19    3. Every contract by which anyone is restrained  from  engaging  in  a
    20  lawful  profession,  trade,  or  business  of any kind is to that extent
    21  void. For all covered individuals, no employer  or  its  agent,  or  the
    22  officer  or  agent  of  any  corporation, partnership, limited liability
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        S. 3100--A                          2
     1  company, or other entity shall seek, require, demand or  accept  a  non-
     2  compete agreement from any covered individual.
     3    4.  (a)  A  covered individual, may bring a civil action in a court of
     4  competent jurisdiction against any employer or persons alleged  to  have
     5  violated  this  section.  A  covered  individual shall bring such action
     6  within two years of the later of: (i) when  the  prohibited  non-compete
     7  agreement  was  signed;  (ii)  when the covered individual learns of the
     8  prohibited non-compete agreement; (iii) when the employment or  contrac-
     9  tual  relationship  is  terminated;  or (iv) when the employer takes any
    10  step to enforce the non-compete agreement.  The court shall have  juris-
    11  diction  to  void any such non-compete agreement and to order all appro-
    12  priate relief, including enjoining the conduct of any person or  employ-
    13  er;   ordering   payment   of  liquidated  damages;  and  awarding  lost
    14  compensation, damages, reasonable attorneys' fees and costs.
    15    (b) For the purposes of this subdivision, liquidated damages shall  be
    16  calculated  as  an  amount not more than ten thousand dollars. The court
    17  shall award liquidated damages  to  every  covered  individual  affected
    18  under  this section, in addition to any other remedies permitted by this
    19  section.
    20    5. Nothing in this  section  shall  be  construed  or  interpreted  as
    21  affecting  any other provision of federal, state, or local law, rule, or
    22  regulation relating to the ability of  an  employer  to  enter  into  an
    23  agreement  with  a prospective or current covered individual that estab-
    24  lishes a fixed term of service or prohibits disclosure of trade secrets,
    25  disclosure of confidential and proprietary client information, or solic-
    26  itation of clients of the employer that the covered  individual  learned
    27  about during employment, provided that such agreement does not otherwise
    28  restrict competition in violation of this section.
    29    6.  Notwithstanding  section  two  hundred  two-k of this chapter, the
    30  provisions of this section shall apply to broadcast employees as defined
    31  in section two hundred two-k of this chapter; provided, however, in  the
    32  event  that  any  clause,  section,  sentence,  paragraph,  subdivision,
    33  section, or part of this section shall  be  adjudged  by  any  court  of
    34  competent  jurisdiction  to  be  invalid, then section two hundred two-k
    35  shall remain in effect unless similarly adjudged to be invalid.
    36    § 2. Severability clause. If any clause, sentence, paragraph, subdivi-
    37  sion, section or part of this act shall be  adjudged  by  any  court  of
    38  competent  jurisdiction  to  be invalid, such judgment shall not affect,
    39  impair, or invalidate the remainder thereof, but shall  be  confined  in
    40  its  operation  to the clause, sentence, paragraph, subdivision, section
    41  or part thereof directly involved in the controversy in which such judg-
    42  ment shall have been rendered. It is hereby declared to be the intent of
    43  the legislature that this act would  have  been  enacted  even  if  such
    44  invalid provisions had not been included herein.
    45    §  3.  This  act shall take effect on the thirtieth day after it shall
    46  have become a law and shall be applicable to contracts entered  into  or
    47  modified on or after such effective date.
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