Missouri Senate Bill SB367

Missouri 2023 Regular Session

• Introduced: 1/4/23
• Refer: 2/23/23

Caption

Modifies provisions relating to venue in guardianship and conservatorship cases and pooled estate accounts by public adminstrators

Impact

The introduction of SB 367 could significantly alter the landscape of trade regulation within Missouri by legitimizing certain types of covenants that were previously seen as potentially restrictive. By allowing specified covenants to be presumed enforceable, the bill endeavors to protect business interests while also ensuring that the scope of enforcement remains reasonable. This change could lead to more robust protections for established businesses against poaching of employees and clients, thereby potentially fostering a more competitive business environment.

Summary

Senate Bill 367 aims to amend Chapter 431 of Missouri's Revised Statutes by introducing provisions related to business covenants. The bill establishes parameters under which covenants not to solicit employees or customers will be presumed enforceable, provided they adhere to specific conditions. For instance, a covenant between a business entity and its owner is enforceable if it is reasonable and lasts no more than two years for employees and five years for customers. This measure is intended to provide clarity and protection for business entities, enhancing their ability to safeguard business interests from competitive threats.

Sentiment

The sentiment surrounding SB 367 appears to be generally positive among business advocates who see it as a necessary step to enhance the enforceability of business-related agreements. Proponents argue it will aid businesses in protecting their legitimate interests while still allowing employees the freedom to seek new opportunities post-termination. However, there are concerns about the potential for these covenants to be misused, leading to restrictive practices that could hinder employee movement and create an uneven playing field within various industries.

Contention

Notable points of contention regarding SB 367 center around concerns that the presumption of enforceability may embolden businesses to enforce overly broad covenants that could unfairly restrict competition and employee mobility. Critics may argue that such covenants could limit job opportunities for individuals seeking new employment after leaving a business, posing risks to workforce dynamics. The potential need for judicial intervention to modify covenants deemed overbroad adds another layer of complexity to the bill's implementation, raising concerns about the balance between protecting business interests and maintaining a competitive job market.