BOSTON — The state legislature enacted a sweeping economic development bill which was signed into law by Governor Charlie Baker earlier this month. The bill includes long-sought reforms championed by Senator Jason Lewis to the enforcement of non-compete agreements in Massachusetts.
Non-compete agreements restrict where somebody can work, for a certain period of time, after leaving their current employer. Many people believe that they are unfair to workers and their families, and that they also hurt our economy by sapping innovation and restricting labor mobility. Originally limited mainly to the high tech industry, their usage in other industries, including the lower-wage service sector, has become more widespread in recent years.
“This economic development legislation will strengthen our economy for all workers, and I’m particularly pleased that it includes significant reforms to non-compete agreements,” said Senator Jason Lewis, Senate Chair of the Committee on Labor and Workforce Development. “These contracts can prevent workers from earning a living and stifle our innovation economy. I greatly appreciate all the hard work that finally got this very important legislation across the finish line.”
The non-compete reforms include the outright ban on the enforcement of non-compete agreements against low-wage workers and workers who are laid off. In cases where non-competes will still be allowed, they will now be restricted in length and scope. Workers will have to be paid a portion of their previous salary during the period of time they are unable to work in their field, and they will also have other new protections.
In addition to non-compete reforms, the economic development bill authorizes grants to workforce training programs and public infrastructure projects across Massachusetts, including:
- $75 million in competitive grants for technical education and workforce training programs
- $250 million for the MassWorks Infrastructure Program that will support thousands of jobs rebuilding local roads, bridges and other infrastructure, and completing community revitalization projects
- $500 million in local economic development aid to our cities and towns
- $2.5 million to support the Massachusetts Cybersecurity Innovation Fund to strengthen capabilities to address cybersecurity threats.
The legislation also established a two-day sales tax holiday weekend, which took place on August 11 and 12 ahead of the back-to-school shopping season.