Michigan Senate Bill SB0143

Michigan 2023-2024 Regular Session

• Introduced: 3/7/23
• Refer: 3/7/23

Caption

Labor: fair employment practices; noncompete agreements; prohibit employers from obtaining unless certain conditions are met. Amends sec. 4a of 1984 PA 274 (MCL 445.774a).

Impact

One of the key provisions of SB 0143 is the prohibition against requesting noncompete agreements from individuals classified as low-wage employees. This is defined as those earning less than $15.00 per hour or an adjusted annual compensation lower than $31,200. Consequently, this bill seeks to provide greater protection for low-wage workers, preventing them from being bound by restrictive agreements that limit their job mobility. In terms of broader implications, the bill is designed to encourage competition by ensuring that employees have the freedom to pursue various job opportunities without facing legal repercussions from their previous employers for violating noncompete terms.

Summary

Senate Bill 0143 aims to amend the Michigan Antitrust Reform Act of 1984, specifically targeting the regulations surrounding noncompete agreements between employers and employees. The amendment seeks to establish stricter requirements for employers seeking to enforce such agreements by requiring them to provide clear written notice to job applicants regarding the necessity of a noncompete agreement. Additionally, employers must disclose the specific terms of any noncompete agreement before hiring the employee. These measures aim to ensure that employees are fully aware of any restrictions that could impact their future employment opportunities.

Contention

The bill's provisions are likely to generate discussion among legislators, employers, and employee rights advocates. While supporters argue that SB 0143 will protect employees and foster a more equitable labor market, critics may view the restrictions on noncompete agreements as overly burdensome for employers, particularly in sectors where intellectual property protection and competitive interests are paramount. Moreover, the bill offers avenues for enforcement, allowing the attorney general to act against employers who violate the noncompete stipulations, which could result in civil violations and fines. In essence, the bill represents an ongoing debate over the balance of power between employers and employees in the labor market.