New Hampshire Legislation Alert: NH Employers Must Provide Notice of Non-Compete Agreements (RSA 275:70)
Employers in New Hampshire making offers of employment are now required to provide prospective employees a copy of any required non-compete agreement prior to or at the time such an offer is made. The new law, effective as of July 14, 2012, also requires that employers provide a copy of the non-compete agreement to any employee being offered a "change in job classification." Any non-compete agreement not so provided to an employee or prospective employee is "null and void."
How will this new law affect existing non-compete agreements?
It is unclear at this time what effect this new legislation will have on existing non-compete agreements entered into prior to the effective date of RSA 275:70. It is also unclear whether the term "non-compete" used in the statute is meant to encompass similar and often related restrictive covenants like non-disclosure or confidentiality agreements.
Regardless of the uncertainty remaining, employers desiring to have employees sign enforceable non-compete agreements in the State of New Hampshire should consider the following steps to help improve the likelihood that their non-compete agreements will be enforceable:
- Offer letters should be revised to include a copy of any non-compete, non-disclosure, and/or confidentiality agreement desired by the employer as a condition of employment.
- Adopting a more formal process for making job changes to ensure that a copy of any required non-compete agreement is provided at the time the offer of job change is made.
- Adding an acknowledgement to the non-compete agreement whereby the employee acknowledges that s/he received a copy of the non-compete agreement prior to or concurrently with the offer of employment.
- Maintaining detailed records of all job offers made to prospective or current employees to evidence the date the copy of the non-compete agreement was provided.
We welcome your questions on this new legislation or other business law issues. Contact John Sullivan at firstname.lastname@example.org, Peter Callaghan at email@example.com or Matthew Lane at firstname.lastname@example.org.