After enacting its non-compete law on April 7, 2016, Utah has twice amended the law to address additional restrictions on non-competes in the broadcasting industry. Governor Gary Herbert signed the second of those amended bills on March 22, 2019.

The Original Non-Compete Law

Utah’s original non-compete law, which we covered in an article dated April 7, 2016, imposed a one-year post-employment time limit on non-competes, except where the non-competes were part of a severance agreement or where they related to or arose out of the sale of a business.   The law also authorized employees to seek damages and attorney’s fees against employers who attempted to enforce invalid non-competes.

The 2018 Amendment

On March 27, 2018, the State amended its non-compete law to impose special restrictions with respect to employees in the broadcasting industry (see our related article, dated April 2, 2018). Specifically, the 2018 amendment provided that, for a non-compete agreement to be enforceable against an employee of a broadcasting company, the company had to establish the following elements:

  • The employee was paid a salary of at least $913 per week (i.e., $47,476 per year);
  • The covenant was part of a written employment contract of no more than four years; and
  • The employee was either terminated “for cause” or had breached the employment contract “in a manner that results in” his or her separation of employment.

In addition, the 2018 amendment prohibited non-competes from extending beyond the original term of the employee’s written contract.

The 2019 Amendment

On March 22, 2019, Governor Herbert signed into law House Bill 199, making a limited change to the provision on broadcasting employees. Specifically, the new law focuses on the year-old requirement that a non-compete in the broadcasting industry must be part of a written contract of no more than four years in duration in order to be valid. Eliminating the four-year written contract requirement, the law now provides that the non-compete must be “part of a written contract of reasonable duration, based on industry standards, the position, the broadcasting employee’s experience, geography, and the parties’ unique circumstances.”

There appears to have been limited media reporting regarding the newest amendment. However, legislators presumably believed the hard, four-year cap on written contract durations did not reflect the realities of the broadcasting industry. Consequently, the new law gives judges more leeway to evaluate the unique circumstances of individual parties, before determining whether a non-compete agreement is reasonable and enforceable.

Companies with questions about the enforceability of restrictive covenants in their jurisdictions are encouraged to contact a Jackson Lewis attorney for further guidance.

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Photo of Clifford R. Atlas Clifford R. Atlas

Clifford Atlas is a Principal in the New York City, New York, office of Jackson Lewis P.C. He is the Co-Leader of the Non-Competes and Protection Against Unfair Competition Practice Group.

Mr. Atlas works extensively with clients in developing and drafting employment contracts and restrictive covenant agreements, and developing programs to best protect clients’ confidential business information. He has significant experience in prosecuting as well as defending actions involving breach of non-competition and non-solicitation agreements, employee raiding, misappropriation of confidential information, tortious interference with contract, unfair competition, and related business claims. Mr. Atlas also has assisted clients in employment issues arising from corporate transactions.

Additionally, Mr. Atlas handles all types of employment discrimination, harassment, disability, wrongful discharge, and related employment tort, contract, wage-hour and employee benefits claims. He has tried cases in state and federal courts, and before administrative agencies. Mr. Atlas has argued numerous appeals to the United States Court of Appeals for the Second Circuit.

Mr. Atlas joined Jackson Lewis in 1985.

Photo of Erik J. Winton Erik J. Winton

Erik J. Winton is a Principal in the Boston, Massachusetts, office of Jackson Lewis P.C. He is the Co-Leader of the firm’s Non-Competes and Protection Against Unfair Competition practice group. His practice focuses on restrictive covenant drafting, counseling, litigation avoidance and litigation. He regularly provides valuable counsel to clients in New England and across the country regarding these issues.

Mr. Winton has extensive experience as a litigator, including successful first chair jury trial experience. He represents employers in federal and state courts and administrative agencies in matters involving discrimination claims based on race, sex, sexual preference, national origin, and disability; retaliation, whistle blowing, wage/hour claims and Department of Labor complaints; allegations of wrongful discharge and breach of contract under the common law; and claims for tortuous injury, such as defamation, infliction of emotional distress and interference with advantageous relations. Mr. Winton has prevailed on the vast majority of dispositive motions filed on his clients’ behalf, including several reported cases.

Mr. Winton’s practice emphasizes advising employers regarding how to comply with the full range of federal and state labor and employment laws. This includes advising clients on issues relating to disability and leave management, reductions in force, wage and hour laws and workplace safety. Mr. Winton also drafts and negotiates executive employment and severance agreements on behalf of both employers and executives.

Mr. Winton speaks frequently regarding employment law issues. He joined the firm in 2000 after five years as a litigator at Fitzhugh & Associates (now Fitzhugh & Mariani, LLP), a litigation boutique with offices in Boston and Hartford, Connecticut. While attending law school, he was on the staff of the Cardozo Arts & Entertainment Law Journal.

Photo of Colin A. Thakkar Colin A. Thakkar

Colin Thakkar is the Knowledge Management (“KM”) Attorney for Jackson Lewis P.C.’s Non-Competes and Protection Against Unfair Competition Practice Group, and is based in the Jacksonville, Florida, office.

In his role, Mr. Thakkar serves as a subject-matter expert on restrictive covenant agreements and unfair competition litigation; creates and manages legal and electronic resources and materials to provide innovative client services; serves as a resource for other practice group members; monitors and analyzes regulatory and case law developments; and contributes to the firm’s blogs and legal updates.

Since 2005, Mr. Thakkar has represented and counseled employers nationwide with regard to federal, state, and local employment laws. In addition to representing companies in non-compete, non-solicitation, and other unfair competition lawsuits, he has defended employers against claims alleging discrimination, unpaid wages, ERISA violations, and other employment-related matters. Mr. Thakkar also has significant experience representing and advising employers regarding traditional labor law issues, including labor arbitrations, unfair labor practice charges, and the interpretation of collective bargaining agreements.