OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sSB-906
AN ACT CONCERNING NONCOMPETE AGREEMENTS.
Primary Analyst: CW 4/11/21
Contributing Analyst(s): DC, DD, AN, PR, JS
Reviewer: MM
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 22 $ FY 23 $
Resources of the General Fund GF - Potential
Revenue Gain
Minimal Minimal
Note: GF=General Fund
Municipal Impact: None
Explanation
The bill, which sets limits on the use of covenant not to compete
provisions in employment contracts, results in a potential minimal
revenue gain to the extent there are violations and a court imposes
penalties.
1
The bill allows aggrieved parties to bring an action before Superior
Court over alleged violations, which does not result in any cost impact.
The court system disposes of over 400,000 cases annually and the
number of cases is not anticipated to be great enough to require
additional resources.
The bill has no cost impact to the state or municipalities as
employers. To the extent that either the state or municipalities enter
into non-compete contracts with their employees, the bill is not
anticipated to change the cost of any such contract.
The Out Years
1
Under the bill a violator is liable for the greater of the aggrieved worker's actual
damages or a $5,000 statutory penalty, in addition to reasonable attorney's fees,
expenses, and court costs. 2021SB-00906-R000402-FN.DOCX Page 2 of 2
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation.