Are employee non-compete agreements enforceable in Maine?
Sometimes, but Maine starts from a statutory anti-restraint rule: 26 M.R.S. § 599-A says non-competes are contrary to public policy and enforceable only if reasonable and no broader than necessary to protect specified employer interests.
The statute limits those interests to trade secrets, confidential information that is not a trade secret, and goodwill. A covenant aimed only at ordinary competition is outside that statutory frame.
Maine common law points in the same direction. Lord says the covenant must sweep no wider than needed to protect the business interest, and Sisters of Charity treats duration, geography, and the nature of the protected interest as fact-intensive reasonableness questions. On a touch screen, a tap shows all 2 sources in this group.
A Maine non-compete is contrary to public policy and enforceable only to the extent it is reasonable and no broader than necessary to protect one of the statute's three legitimate business interests — trade secrets, non-trade-secret confidential information, or goodwill — so a covenant aimed at ordinary competition sits outside the statutory frame and does not hold . The common law measures the same restraint: it must sweep no wider than the interest at issue requires, and duration, geography, and the nature of the protected interest are weighed together as a fact-intensive question, so a term or radius carried from another form is measured against an interest it was never sized to. On a touch screen, a tap shows all 2 sources in this group.
Sources for this answer
26 M.R.S. § 599-A supports Maine's baseline rule that employee non-competes are contrary to public policy and enforceable only to the extent they are reasonable and no broader than necessary to protect enumerated legitimate business interests of the employer.
Noncompete agreements are contrary to public policy and are enforceable only to the extent that they are reasonable and are no broader than necessary to protect one or more of the following legitimate business interests of the employer:
See 26 M.R.S. § 599-A(2).
Lord supports Maine's common-law rule that non-competition agreements are enforced only to the extent reasonable and no broader than necessary to protect the business interest at issue.
We have long recognized that non-competition agreements are contrary to public policy and will be enforced only to the extent that they are reasonable and sweep no wider than necessary to protect the business interests in issue.
See Lord v. Lord, 454 A.2d 830, 834 (Me. 1983).
Sisters of Charity supports the fact-intensive Maine reasonableness inquiry based on duration, geographic scope, and the protected interest.
Although reasonableness is a question of law, the inquiry is fact-intensive, and it depends on the specific circumstances of the case: the covenant’s duration, the scope of the specified geographic area, and the nature of the interest to be protected.
See Sisters of Charity Health Sys., Inc. v. Farrago, 2011 ME 62, ¶ 10, 21 A.3d 110.
Which Maine workers cannot be bound by non-competes?
Maine bars non-competes for employees earning at or below 400 percent of the federal poverty level and for non-owner licensed veterinarians in covered veterinary facilities. On a touch screen, a tap shows all 2 sources in this group.
The wage floor moves with the federal poverty level. Foley reports that Maine updated its threshold from $60,240 in 2024 to $62,600 in 2025 .
The veterinarian rule is stronger than ordinary non-enforcement. The current statutory text also tells courts not to enforce earlier or renewed veterinarian non-competes unless the veterinarian has an ownership interest in the facility .
P.L. 2025, ch. 718 bars a non-compete with an employee health-care practitioner who has no ownership interest in the employer. The act applies to agreements entered into or renewed on or after July 29, 2026; a permitted practitioner covenant must also honor patients’ choice of practitioner. On a touch screen, a tap shows all 5 sources in this group.
Sources for this answer
Section 599-A(3), as shown in this older codified quotation, prohibits employers from requiring or permitting non-competes for the listed wage and non-owner veterinarian categories; it also addresses prior veterinarian agreements.
3. Prohibited for certain workers. Notwithstanding subsection 2, an employer may not require or permit an employee to enter into a noncompete agreement with the employer if: A. The employee is earning wages at or below 400% of the federal poverty level; or [PL 2023, c. 118, §1 (NEW).] B. The employee is a veterinarian licensed under Title 32, chapter 71‑A and is employed in a veterinary facility in which the employee does not have an ownership interest. [PL 2023, c. 118, §1 (AMD).] A court may not enforce a noncompete agreement entered into or renewed with an employee who is a veterinarian licensed under Title 32, chapter 71‑A before the effective date of this paragraph unless the employee is working in a veterinary facility in which the employee has an ownership interest. [PL 2023, c. 118, §1 (NEW).]
See 26 M.R.S. § 599-A(3); read with P.L. 2025, ch. 718, § 3.
Foley supports the 2025 dollar threshold for Maine's 400 percent federal-poverty-level non-compete wage floor.
Accordingly, Maine is updating its $60,240 threshold from 2024 to $62,600 in 2025.
See Foley & Lardner, Noncompete Agreements: Updated Income Thresholds for 2025 (2025).
26 M.R.S. § 599-A supports the special non-enforcement rule for earlier or renewed veterinarian non-competes unless the veterinarian has an ownership interest.
A court may not enforce a noncompete agreement entered into or renewed with an employee who is a veterinarian licensed under Title 32, chapter 71‑A before the effective date of this paragraph unless the employee is working in a veterinary facility in which the employee has an ownership interest.
See 26 M.R.S. § 599-A(3).
Section 3 adds non-owner employee health-care practitioners as paragraph C of § 599-A(3), whose introductory prohibition governs the listed categories.
Sec. 3. 26 MRSA §599-A, sub-§3, ¶C is enacted to read: C. The employee is a health care practitioner who is employed by an entity in which that health care practitioner does not have an ownership interest.
See P.L. 2025, ch. 718, §§ 1–5 (approved Apr. 15, 2026).
Section 2 requires an otherwise enforceable practitioner non-compete to recognize the patient's choice of practitioner.
A noncompete agreement between an employer and a health care practitioner that is enforceable under this subsection must recognize an individual's right to choose that individual's own health care practitioner.
See P.L. 2025, ch. 718, § 2.
Section 5 applies the amendment to non-competes entered into or renewed on or after the act's effective date.
This Act applies to all noncompete agreements entered into or renewed on or after the effective date of this Act.
See P.L. 2025, ch. 718, § 5.
The official session-law volume gives July 29, 2026 as the effective date of nonemergency acts from this session, including chapter 718.
The general effective date of the nonemergency laws passed at the Second Regular Session of the 132nd Legislature is July 29, 2026.
See Laws of Maine, 132nd Legislature, Second Regular Session, cover.
What notice and timing rules apply to Maine non-competes?
Maine employers must disclose a required non-compete before offering employment and provide the employee a copy at least 3 business days before signing . For most employees, the covenant takes effect only after the later of one year of employment or 6 months after signing . Section 4 of P.L. 2025, ch. 718 extends the timing exception from certain physicians to health-care practitioners; section 3 separately bars non-owner employee practitioners’ non-competes. On a touch screen, a tap shows all 3 sources in this group.
The notice rule has two parts. First, if the job will require a non-compete, the employer must disclose that requirement before making the offer. Second, the employer must provide the agreement at least 3 business days before the required signing date.
The delayed-effectiveness rule is separate from the signing rule. A compliant agreement can be signed before it takes effect. For most employees, the restriction does not ripen until both the statutory waiting period and the employment-duration rule are satisfied.
Maine's pre-offer disclosure and 3-business-day copy requirements sit upstream of signing, so a signature collected on time does not cure a missed disclosure or a shortened review window, and the covenant is exposed even where the executed agreement looks complete .
Sources for this answer
26 M.R.S. § 599-A(4) requires pre-offer disclosure and a copy of the noncompete agreement at least 3 business days before signing.
An employer shall disclose prior to an offer of employment with the employer that will require the acceptance of a noncompete agreement a statement that a noncompete agreement will be required. An employer shall notify an employee or prospective employee of a noncompete agreement requirement and provide a copy of the noncompete agreement not less than 3 business days before the employer requires the agreement to be signed to allow time for the employee or prospective employee to review the agreement and negotiate the terms of the agreement or employment with the employer if the employee or prospective employee wishes to do so.
See 26 M.R.S. § 599-A(4).
26 M.R.S. § 599-A supports Maine's delayed-effectiveness rule and the statutory physician exception.
Except for a noncompete agreement between an employer and an allopathic physician or an osteopathic physician licensed under Title 32, chapter 48 or chapter 36, respectively, the terms of a noncompete agreement do not take effect until after one year of the employee's employment with the employer or a period of 6 months from the date the agreement was signed, whichever is later.
See 26 M.R.S. § 599-A(5).
Section 4 of chapter 718 replaces the physician-specific delayed-effectiveness exception with a health-care-practitioner exception. The quotation preserves the enrolled redline: the physician-specific wording is struck out and replaced by “a health care practitioner”; the deleted words are not part of the amended rule.
Except for a noncompete agreement between an employer and an allopathic physician or an osteopathic physician licensed under Title 32, chapter 48 or chapter 36, respectively a health care practitioner, the terms of a noncompete agreement do not take effect until after one year of the employee's employment with the employer or a period of 6 months from the date the agreement was signed, whichever is later.
See P.L. 2025, ch. 718, § 4 (amending 26 M.R.S. § 599-A(5)).
Section 599-A(3), as shown in this older codified quotation, prohibits employers from requiring or permitting non-competes for the listed wage and non-owner veterinarian categories; it also addresses prior veterinarian agreements.
3. Prohibited for certain workers. Notwithstanding subsection 2, an employer may not require or permit an employee to enter into a noncompete agreement with the employer if: A. The employee is earning wages at or below 400% of the federal poverty level; or [PL 2023, c. 118, §1 (NEW).] B. The employee is a veterinarian licensed under Title 32, chapter 71‑A and is employed in a veterinary facility in which the employee does not have an ownership interest. [PL 2023, c. 118, §1 (AMD).] A court may not enforce a noncompete agreement entered into or renewed with an employee who is a veterinarian licensed under Title 32, chapter 71‑A before the effective date of this paragraph unless the employee is working in a veterinary facility in which the employee has an ownership interest. [PL 2023, c. 118, §1 (NEW).]
See 26 M.R.S. § 599-A(3); read with P.L. 2025, ch. 718, § 3.
Section 3 adds non-owner employee health-care practitioners as paragraph C of § 599-A(3), whose introductory prohibition governs the listed categories.
Sec. 3. 26 MRSA §599-A, sub-§3, ¶C is enacted to read: C. The employee is a health care practitioner who is employed by an entity in which that health care practitioner does not have an ownership interest.
See P.L. 2025, ch. 718, §§ 1–5 (approved Apr. 15, 2026).
Will Maine courts narrow or reform an overbroad non-compete?
Often they evaluate the restraint as applied, not only as drafted. Brignull says Maine assesses a non-compete only as the employer sought to apply it.
That makes Maine different from a strict red-pencil jurisdiction and from a mechanical blue-pencil state. The court can focus on the actual enforcement request, but the requested restraint still must be reasonable in duration, geography, and protected interest.
Lord gives the limiting principle. The court may require specificity about what goodwill or business value needs protection before imposing or enforcing a severe restraint . For a clause-by-clause pass over a specific agreement against these rules, the Maine non-compete reviewer checklist walks the full covenant suite item by item with each requirement's force level.
Maine's as-applied review is not a license for a broad covenant. Because Maine assesses a non-compete only as the employer has sought to apply it, and whether a court will rewrite an overbroad covenant as drafted is unsettled, a covenant that outruns the interest it protects is exposed rather than assured of judicial narrowing . Lord supplies the limiting principle: the record must define the protected goodwill or business value first and then the scope reasonably necessary to protect it, so the restraint that holds is the one drawn to the interest the employer actually intends to enforce .
Sources for this answer
Brignull supports Maine's as-applied review of non-compete reasonableness.
Finally, because the reasonableness of a noncompetition agreement depends on the specific facts of the case, we assess the agreement only as Brignull has sought to apply it and not as it might have been enforced on its terms.
See Brignull v. Albert, 666 A.2d 82, 84 (Me. 1995).
Lord supports requiring specificity about the protected goodwill or business value before imposing a severe non-competition restraint.
Upon remand, on the basis of the existing record and any further evidence received, the presiding justice should first define the nature and components of the good will included in the determination of value and then proceed to determine the scope of any restraint which may be reasonably necessary to protect the value of the asset.
See Lord v. Lord, 454 A.2d 830, 835 (Me. 1983).
Are employer no-poach or no-hire agreements allowed in Maine?
No. 26 M.R.S. § 599-B prohibits employer-to-employer restrictive employment agreements that restrict one employer from soliciting or hiring another employer's employees or former employees .
The statute reaches agreements between two or more employers, including through franchise, contractor, and subcontractor arrangements. It separately bars entering into the agreement, enforcing it, or threatening enforcement.
Violations carry a civil fine of at least $5,000, and the Maine Department of Labor enforces the section .
Section 599-B's ban is not limited to a stand-alone no-poach contract: it reaches a no-solicit or no-hire term buried in a franchise, contractor, or subcontractor arrangement between two or more employers, and it bars entering into, enforcing, or threatening to enforce such a term alike . A violation is a civil violation carrying a fine of not less than $5,000 enforced by the Maine Department of Labor, so a commercial agreement that quietly restricts who may hire another employer's workers carries statutory exposure independent of any employee covenant .
Sources for this answer
26 M.R.S. § 599-B supports Maine's prohibition on employer-to-employer no-poach or no-hire agreements.
An employer may not: A. Enter into a restrictive employment agreement
See 26 M.R.S. § 599-B(2).
26 M.R.S. § 599-B supports the civil penalty and Department of Labor enforcement rule for prohibited restrictive employment agreements.
An employer that violates subsection 2 commits a civil violation for which a fine of not less than $5,000 may be adjudged. The Department of Labor is responsible for enforcement of this section.
See 26 M.R.S. § 599-B(3).
Are non-solicitation and confidentiality agreements safer alternatives in Maine?
Often yes. Section 599-A itself points to nonsolicitation, nondisclosure, and confidentiality agreements as alternatives, and a non-compete may be presumed necessary only when those alternatives cannot adequately protect the interest .
That does not make every alternative covenant low risk. A confidentiality covenant can protect information beyond trade secrets, but it cannot bar use of general skill or knowledge. Bernier upheld a nondisclosure clause because it protected specialized original work without stopping the employee from using general skill and knowledge .
A confidentiality definition that expressly excludes the general skill and knowledge the employee acquired on the job matches the nondisclosure clause in Bernier, which did not prohibit the employee from using that skill and knowledge .
Maine also has a separate employment NDA statute. Section 599-C protects reporting, testimony, evidence, and law-enforcement communications in discrimination-related contexts, while preserving ordinary protections for proprietary information, trade secrets, and information confidential by law. On a touch screen, a tap shows all 2 sources in this group.
Under Maine's noncompete statute, 26 M.R.S. § 599-A(2), a non-compete may be presumed necessary if an alternative restrictive covenant cannot adequately protect the legitimate business interest. The alternatives the statute names include nonsolicitation, nondisclosure, and confidentiality agreements . A non-compete used without a record showing that those alternatives were considered and found inadequate starts a step behind the statute's own ordering.
Sources for this answer
26 M.R.S. § 599-A supports using nonsolicitation, nondisclosure, and confidentiality agreements as alternative restrictive covenants before relying on a non-compete.
A noncompete agreement may be presumed necessary if the legitimate business interest cannot be adequately protected through an alternative restrictive covenant, including but not limited to a nonsolicitation agreement or a nondisclosure or confidentiality agreement.
See 26 M.R.S. § 599-A(2).
Bernier supports enforcing confidentiality covenants for specialized proprietary information while preserving the employee's ability to use general skill and knowledge.
The nondisclosure clause does not prohibit Bernier from using the general skill and knowledge he acquired during his employment with Merrill.
See Bernier v. Merrill Air Eng'rs, 2001 ME 17, ¶ 18, 770 A.2d 97.
26 M.R.S. § 599-C supports Maine's limits on employment agreements that waive or limit rights to report or discuss unlawful employment discrimination.
An employer may not require an employee, intern or applicant for employment to enter into a contract or agreement that waives or limits any right to report or discuss unlawful employment discrimination, as defined and limited by Title 5, chapter 337, subchapter 3, occurring in the workplace or at work-related events.
See 26 M.R.S. § 599-C(2).
26 M.R.S. § 599-C supports preserving nondisclosure agreements for proprietary information, trade secrets, and information otherwise confidential by law.
Nothing in this section may be construed as limiting the use of nondisclosure agreements to protect the confidentiality of proprietary information, trade secrets or information that is otherwise confidential by law, rule or regulation.
See 26 M.R.S. § 599-C(4).
How does Maine treat sale-of-business non-compete covenants?
Maine's noncompete statute reaches only an employee or prospective employee, so a covenant given by the seller of a business falls outside it and remains governed by common-law reasonableness. On a touch screen, a tap shows all 2 sources in this group.
Because Section 599-A is defined by the employment relationship , a seller's covenant is tested under Maine common law, which enforces a restraint only so far as it is reasonable and no wider than necessary to protect the business interest at issue . Maine has no modern controlling decision in our review applying that standard specifically to a sale-of-business covenant, so the seller analysis rests on the general common-law rule rather than a seller-specific holding.
Sources for this answer
26 M.R.S. § 599-A defines a noncompete agreement solely by reference to an employee or prospective employee, so the statute reaches only the employment relationship and not a covenant given by the seller of a business.
“Noncompete agreement” means a contract or contract provision that prohibits an employee or prospective employee from working in the same or a similar profession or in a specified geographic area for a certain period of time following termination of employment.
See 26 M.R.S. § 599-A(1)(B).
Lord supports Maine's common-law rule that non-competition agreements are enforced only to the extent reasonable and no broader than necessary to protect the business interest at issue.
We have long recognized that non-competition agreements are contrary to public policy and will be enforced only to the extent that they are reasonable and sweep no wider than necessary to protect the business interests in issue.
See Lord v. Lord, 454 A.2d 830, 834 (Me. 1983).
What trade-secret remedies are available in Maine?
Maine trade-secret law gives employers remedies that can substitute for or sit beside narrow restrictive covenants, including injunctions, damages, exemplary damages, and attorney-fee awards. On a touch screen, a tap shows all 3 sources in this group.
The definition matters because § 599-A cross-references Title 10, section 1542 for trade secrets. Maine defines a trade secret as information that derives independent economic value from not being generally known or readily ascertainable and is subject to reasonable secrecy efforts .
The remedies are practical. Courts may restrain actual or threatened misappropriation, award actual loss and unjust enrichment, use a reasonable royalty measure, and award exemplary damages for willful and malicious misappropriation. On a touch screen, a tap shows all 2 sources in this group.
Sources for this answer
10 M.R.S. § 1542 supports Maine's statutory trade-secret definition.
"Trade secret" means information, including, but not limited to, a formula, pattern, compilation, program, device, method, technique or process, that:
See 10 M.R.S. § 1542(4).
10 M.R.S. § 1543 supports injunctive relief for actual or threatened trade-secret misappropriation.
Actual or threatened misappropriation may be restrained or enjoined.
See 10 M.R.S. § 1543(1).
10 M.R.S. § 1544 supports actual-loss and unjust-enrichment damages plus a reasonable-royalty alternative measure, and separately (in subsection 2) exemplary damages for willful and malicious misappropriation.
Damages may include both the actual loss caused by misappropriation and the unjust enrichment caused by misappropriation that is not taken into account in computing actual loss. In lieu of damages measured by any other methods, the damages caused by misappropriation may be measured by imposition of liability for a reasonable royalty for a misappropriator's unauthorized disclosure or use of a trade secret.
See 10 M.R.S. § 1544(1).
10 M.R.S. § 1545 supports attorney-fee awards for bad-faith trade-secret claims or motions and for willful and malicious misappropriation.
If a claim of misappropriation is made in bad faith, a motion to terminate an injunction is made or resisted in bad faith or willful and malicious misappropriation exists, the court may award reasonable attorneys fees to the prevailing party.
See 10 M.R.S. § 1545.
What recent Maine non-compete developments should employers track?
Track three moving points: the annually indexed wage threshold, the 2024 veto of L.D. 1496, and the newly enacted L.D. 2200 non-owner employee health-care-practitioner restriction effective July 29, 2026. On a touch screen, a tap shows all 6 sources in this group.
The 2024 veto means Maine did not move to a near-total employee non-compete ban then. Bernstein Shur reports that the veto was sustained on April 2, 2024, so employers continued to draft under the existing L.D. 733 framework .
The 2026 health-care amendment is now law. L.D. 2200 was approved on April 15, 2026; it applies to non-competes entered into or renewed on or after July 29, 2026. Its new employee ban concerns practitioners without an ownership interest in their employer. On a touch screen, a tap shows all 4 sources in this group.
L.D. 2200's non-owner employee health-care-practitioner restriction applies to non-competes entered into or renewed on or after its July 29, 2026 effective date, so the trigger is the made-or-renewed date rather than when a dispute arises. On a touch screen, a tap shows all 2 sources in this group. A covenant for such a practitioner renewed on or after that date is measured against the new rule even if the original agreement predates it. The older published § 599-A text alone does not show that change .
Sources for this answer
Foley supports that Maine's non-compete wage threshold is indexed and increases each year, making it a recurring item to re-check.
Specifically, thresholds in Washington, Colorado, Maine, Rhode Island, Oregon, Virginia, and Washington, D.C. increase each year.
See Foley & Lardner, Noncompete Agreements: Updated Income Thresholds for 2025 (2025).
Bernstein Shur supports the 2024 L.D. 1496 veto status and the point that Maine employers continued to reference L.D. 733 after the veto was sustained.
Because L.D. 1496 was vetoed and that veto was sustained by the Maine State Legislature, Maine employers should continue to reference L.D. 733 when drafting and negotiating noncompete agreements.
See Bernstein Shur, Governor Mills Vetoes L.D. 1496: What Maine Employers Need to Know (2024).
Section 3 adds non-owner employee health-care practitioners as paragraph C of § 599-A(3), whose introductory prohibition governs the listed categories.
Sec. 3. 26 MRSA §599-A, sub-§3, ¶C is enacted to read: C. The employee is a health care practitioner who is employed by an entity in which that health care practitioner does not have an ownership interest.
See P.L. 2025, ch. 718, § 3.
Chapter 718 applies to agreements entered into or renewed on or after its effective date.
This Act applies to all noncompete agreements entered into or renewed on or after the effective date of this Act.
See P.L. 2025, ch. 718, §§ 3, 5.
The official session-law volume gives July 29, 2026 as the general effective date of the second regular session's nonemergency acts, including chapter 718.
The general effective date of the nonemergency laws passed at the Second Regular Session of the 132nd Legislature is July 29, 2026.
See Laws of Maine, 132nd Legislature, Second Regular Session, cover; P.L. 2025, ch. 718, § 5.
Section 599-A(3), as shown in this older codified quotation, prohibits employers from requiring or permitting non-competes for the listed wage and non-owner veterinarian categories; it also addresses prior veterinarian agreements.
3. Prohibited for certain workers. Notwithstanding subsection 2, an employer may not require or permit an employee to enter into a noncompete agreement with the employer if: A. The employee is earning wages at or below 400% of the federal poverty level; or [PL 2023, c. 118, §1 (NEW).] B. The employee is a veterinarian licensed under Title 32, chapter 71‑A and is employed in a veterinary facility in which the employee does not have an ownership interest. [PL 2023, c. 118, §1 (AMD).] A court may not enforce a noncompete agreement entered into or renewed with an employee who is a veterinarian licensed under Title 32, chapter 71‑A before the effective date of this paragraph unless the employee is working in a veterinary facility in which the employee has an ownership interest. [PL 2023, c. 118, §1 (NEW).]
See 26 M.R.S. § 599-A(3); read with P.L. 2025, ch. 718, § 3.
What does federal law require a non-compete or confidentiality agreement in Maine to say about whistleblowers and pay?
An employee confidentiality, non-compete, or invention assignment agreement signed or updated now that governs trade secrets or other confidential information must give the Defend Trade Secrets Act whistleblower-immunity notice, and for employees the National Labor Relations Act covers, Section 7 of that Act protects concerted activity, including joining together over pay and working conditions, that a broad confidentiality clause can restrict. The employer may satisfy the notice duty by cross-referencing a qualifying policy document provided to the employee, but an employer that omits the notice may not be awarded exemplary damages or attorney fees under the Defend Trade Secrets Act in an action against an employee who was not given notice.
The notice describes a federal immunity: an individual cannot be held liable under federal or state trade-secret law for disclosing a trade secret in confidence to a government official or an attorney solely to report or investigate a suspected violation of law, or in a court filing made under seal. For an agreement signed or updated now, the duty to give that notice reaches any agreement with an employee that governs trade secrets or other confidential information, whatever else the agreement does.
Section 7 gives employees the National Labor Relations Act covers a statutory right to engage in concerted activity for mutual aid or protection, including joining together to improve pay and working conditions. For employees the Act covers, the Board's work-rule standard adopted in 2023 makes a rule presumptively unlawful if it has a reasonable tendency to chill employees from exercising their Section 7 rights; an employer can rebut that presumption only by showing a legitimate and substantial business interest it cannot serve with a more narrowly tailored rule. The 2023 standard may change, but the Section 7 right it enforces is statutory. State law may add its own requirements for the same clauses.
A form carried over without the immunity notice, or a cross-reference to a reporting policy the employee never received, leaves the confidentiality clause without a valid notice, so the Act's exemplary damages and attorney fees are unavailable against that employee. A Confidential Information definition that sweeps in pay and working conditions with no carve-out exposes the employer to an unfair-labor-practice finding for employees the Act covers.
Sources for this answer
An individual is immune from criminal and civil liability under federal and state trade-secret law for disclosing a trade secret in confidence to a government official or an attorney solely to report or investigate a suspected violation of law, or in a court filing made under seal.
An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that— (A) is made— (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
See 18 U.S.C. § 1833(b)(1).
An employer must give notice of the trade-secret whistleblower immunity in any contract or agreement with an employee that governs the use of a trade secret or other confidential information.
An employer shall provide notice of the immunity set forth in this subsection in any contract or agreement with an employee that governs the use of a trade secret or other confidential information.
See 18 U.S.C. § 1833(b)(3)(A).
An employer complies with the notice requirement by cross-referencing a policy document, provided to the employee, that sets out the employer's reporting policy for a suspected violation of law.
An employer shall be considered to be in compliance with the notice requirement in subparagraph (A) if the employer provides a cross-reference to a policy document provided to the employee that sets forth the employer's reporting policy for a suspected violation of law.
See 18 U.S.C. § 1833(b)(3)(B).
An employer that does not give the required notice may not be awarded exemplary damages or attorney fees in a trade-secret action against an employee who did not receive it.
If an employer does not comply with the notice requirement in subparagraph (A), the employer may not be awarded exemplary damages or attorney fees under subparagraph (C) or (D) of section 1836(b)(3) in an action against an employee to whom notice was not provided.
See 18 U.S.C. § 1833(b)(3)(C).
Section 7 gives employees the right to engage in concerted activities for mutual aid or protection, the statutory basis for keeping discussion of pay and working conditions outside confidentiality restrictions.
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 158(a)(3) of this title.
See 29 U.S.C. § 157 (NLRA § 7).
The National Labor Relations Board protects the right of private-sector employees, with or without a union, to join together to improve wages, benefits, and working conditions.
Established in 1935, the National Labor Relations Board is an independent federal agency that protects employees from unfair labor practices and protects the right of private sector employees to join together, with or without a union, to improve wages, benefits and working conditions.
See NLRB Office of Public Affairs, news release of Feb. 21, 2023 (agency mission statement).
Under the work-rule standard the Board adopted in 2023, a rule with a reasonable tendency to chill employees from exercising their Section 7 rights is presumptively unlawful unless the employer proves a legitimate and substantial business interest it cannot advance with a more narrowly tailored rule.
Under the new standard adopted in Stericycle, the General Counsel must prove that a challenged rule has a reasonable tendency to chill employees from exercising their rights. If the General Counsel does so, then the rule is presumptively unlawful. However, the employer may rebut the presumption by proving that the rule advances a legitimate and substantial business interest and that the employer is unable to advance that interest with a more narrowly tailored rule.
See Stericycle, Inc., 372 NLRB No. 113 (2023); NLRB Office of Public Affairs, Board Adopts New Standard for Assessing Lawfulness of Work Rules (Aug. 2, 2023).