B 24-0256 — Non-Compete Conflict of Interest Clarification Amendment Act of 2021

ENGROSSEDENROLLED ORIGINAL AAN BILLACT 3 24-256 5 IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 7 ______________________ 9 To amend the Ban on Non-Compete Agreements Amendment Act of 2020 to clarify which provisions in workplace policies or employment agreements will not violate the law’s restrictions on the use of non-compete provisions and agreements;agreements, clarify that employers may bar an employee’s use, in addition to the disclosure, of confidential and proprietary information during or after the employee’s employment for the employer, create a limited exception allowing the use of non-compete provisions with highly-compensated employees, including medical specialists, under specified circumstances, specify what must be contained in a non-compete agreement for it to be valid and enforceable, clarify remedies for violations of the act, clarify how the act relates to a collective bargaining agreement, clarify how the law applies relative to other District laws, and to clarify rulemaking requirements.

to clarify that employers may bar an employee’s use, in addition to the disclosure, of confidential and proprietary information during or after the employee’s employment for the employer;

to create a limited exception allowing the use of non-compete provisions with highly- compensated employees, including medical specialists, under specified circumstances;

to specify what must be contained in a non-compete agreement for it to be valid and enforceable;

to clarify remedies for violations of the act;

to clarify how the Act relates to a collective bargaining agreement;

to clarify how the law applies relative to other District laws;

and to clarify rulemaking requirements.

ENGROSSED ORIGINAL “(1) “An Act” means An Act To provide for the payment and collection of wages in the District of Columbia, approved August 3, 1956 (70 Stat.

Official Code § 32- 1301 et seq.).

“(2) “Broadcast employee” means an employee,on- otheror thanoff-air acreator sales(such representative,as an anchor, disc jockey, editor, producer, program host, reporter, or writer) of a legal entity that owns or operates one or more of the following:

“(A) TelevisionA stationstelevision station or networks;network;

“(B) RadioA stationsradio station or networks;network;

“(C) CableA stationscable station or networks;network;

or ENROLLED ORIGINAL “(E) Any other entity that provides broadcasting services such as news, weather, traffic, sports, or entertainment programming.

“(v) Overtime premiums;;premiums;

and “(vi) Vested stock, including restricted stock units.;units;

and ENGROSSED“(vii) ORIGINAL (vii) Other payments provided on a regular or irregular basis.

“(4) “Confidential employer information” means information owned or possessed by the employer whichthat is not available to the general public and whichthat the employer has taken reasonable steps to ensure is protected from improper disclosure.

“(i) TheSpends employee spends more than 50% of his or her work time for the employer working in the District;

or “(B) If the employee has not yet commenced work for the employer:

ENGROSSED ORIGINAL “(i) TheHas an employer that reasonably anticipates that the employee will spend more than 50% of his or her work time for the employer working in the District;

or ENROLLED ORIGINAL "(ii) An individual to whom the employer has made an offer of employment and whom an employer reasonably anticipates will perform work for pay on behalf of the employer in the District.

“(B) DoesThe term does not mean:

“(i) An individual employed as a casual babysitter,babysitter in or about the residence of the employer;

“(8) “Employer” means an individual, partnership, general contractor, subcontractor, association, corporation, or business trust operating in the District, or any person or group of persons acting directly or indirectly in the interest of an employer operating in the ENGROSSED ORIGINAL District in relation to an employee, including a prospective employer,employer. but does not mean the District government or the United States government “(9) “Higher education institution” means a postsecondary educational institution accredited by an agency that the United States Department of Education recognizes as an accrediting agency.

“(10)The “Highlyterm compensateddoes employee”not mean the District government or the United States government “(9) “Higher education institution” means a postsecondary educational institution accredited by an employee,agency otherthat thanthe aUnited broadcastStates employee:Department of Education recognizes as an accrediting agency.

“(A)“(10) Who“Highly iscompensated reasonablyemployee” expectedmeans, toother earnthan from the employer, in a consecutivebroadcast 12-monthemployee, period,an compensationemployee: greater than or equal to the minimum qualifying annual compensation;

“(A) Who is reasonably expected to earn from the employer in a consecutive 12-month period compensation greater than or equal to the minimum qualifying annual compensation;

(__)“(11) “Long“Long-term termincentive” incentimeansmeans bonuses, equity compensation, stock options, restricted and unrestricted stock shares or units, performance stock shares or units, phantom stock shares, stock appreciation rightsrights, and other performance driven incentives for individual or corporate achievements typically earned over more than one year.

“(11)“(12) “Medical specialist” means a highly compensated employee who is engaged primarily in the delivery of medical services,services and who:

ENGROSSED ORIGINAL “(B) Is a physician;;physician;

and “(C) Has completed a medical residency.;residency;

and (D)“(D) Receives total compensation in the amount equal to or greater than $250,000.$ 250,000.

“(12)“(13) “Minimum qualifying annual compensation” means:

“(A) Beginning with the calendar year in which this title becomes applicable,applicable: $250,000.

(A)“(i) Beginning$150,000; with the calendar year in which this title becomes applicable:

(i) $150,000 or (ii)“(ii) $250,000$250,000, if the employee is a medical specialist.

ENROLLED ORIGINAL “(B) For the calendar year beginning January 1, 2024, and each calendar year thereafter, an amount equal to the previous calendar year’s minimum qualifying annual compensation, increased in proportion to the annual average increase, if any, in the Consumer Price Index for All Urban Consumers in the Washington Metropolitan Statistical Area published by the Bureau of Labor Statistics of the United States Department of Labor for the previous calendar year adjusted to the nearest whole dollar.

“(13)“(14) “Non-compete agreement” means a contract between an employer and employee that has one or more non-compete provisions.