The New York State Senate

                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  4610

                       2017-2018 Regular Sessions

                            I N  S E N A T E

                            February 21, 2017
                               ___________

Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Labor

AN ACT to amend the labor law, in relation to prohibiting employers from
  requiring low-wage employees to enter into covenants  not  to  compete
  and  requiring employers to notify potential employees of any require-
  ment to enter into a covenant not to compete

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  This act shall be known and may be cited as the "New York
State mobility and opportunity for vulnerable employees act" or the  "NY
MOVE act".
  §  2.  The  labor law is amended by adding a new article 33 to read as
follows:
                                ARTICLE 33
  NEW YORK STATE MOBILITY AND OPPORTUNITY FOR VULNERABLE EMPLOYEES ACT
SECTION 950. DEFINITIONS.
        951. PROHIBITING COVENANTS NOT TO COMPETE FOR  LOW-WAGE  EMPLOY-
               EES.
        952. DISCLOSURE REQUIREMENT FOR COVENANTS NOT TO COMPETE.
        953. ENFORCEMENT.
  §  950. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE, THE FOLLOWING TERMS
SHALL HAVE THE FOLLOWING MEANINGS:
  1. "COMMERCE" HAS THE MEANING GIVEN SUCH TERM IN SECTION THREE OF  THE
FAIR LABOR STANDARDS ACT OF 1938 (29 U.S.C. 203).
  2. "COVENANT NOT TO COMPETE" MEANS AN AGREEMENT:
  (A) BETWEEN AN EMPLOYEE AND EMPLOYER THAT RESTRICTS SUCH EMPLOYEE FROM
PERFORMING:
  (I) ANY WORK FOR ANOTHER EMPLOYER FOR A SPECIFIED PERIOD OF TIME;
  (II) ANY WORK IN A SPECIFIED GEOGRAPHICAL AREA; OR
  (III)  WORK  FOR  ANOTHER  EMPLOYER THAT IS SIMILAR TO SUCH EMPLOYEE'S
WORK FOR THE EMPLOYER INCLUDED AS A PARTY TO THE AGREEMENT; AND

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD03762-01-7

S. 4610                             2

  (B) THAT IS ENTERED INTO AFTER THE EFFECTIVE DATE OF THIS ARTICLE.
  3.   "EMPLOYEE",  "EMPLOYER",  "ENTERPRISE",  "ENTERPRISE  ENGAGED  IN
COMMERCE OR IN THE PRODUCTION OF GOODS FOR COMMERCE", AND  "GOODS"  HAVE
THE  MEANINGS GIVEN SUCH TERMS IN SECTION THREE OF THE FAIR LABOR STAND-
ARDS ACT OF 1938 (29 U.S.C. 203).
  4. "LIVABLE HOURLY RATE" MEANS:
  (A) FOR THE FISCAL YEAR OF THE EFFECTIVE DATE  OF  THIS  ARTICLE,  THE
GREATER OF:
  (I) FIFTEEN DOLLARS PER HOUR; OR
  (II)  THE HOURLY RATE EQUAL TO THE MINIMUM WAGE REQUIRED BY THE APPLI-
CABLE STATE OR LOCAL MINIMUM WAGE LAW; AND
  (B) FOR EACH SUCCEEDING FISCAL YEAR, THE GREATER OF:
  (I) THE ADJUSTED AMOUNT DESCRIBED IN SUBDIVISION THREE OF SECTION NINE
HUNDRED FIFTY-ONE OF THIS ARTICLE; OR
  (II) THE HOURLY RATE EQUAL TO THE MINIMUM WAGE REQUIRED BY THE  APPLI-
CABLE STATE OR LOCAL MINIMUM WAGE LAW.
  5. "LOW-WAGE EMPLOYEE":
  (A)  MEANS  AN  EMPLOYEE  WHO,  EXCLUDING  ANY  OVERTIME  COMPENSATION
REQUIRED UNDER SECTION SEVEN OF THE FAIR LABOR STANDARDS ACT OF 1938 (29
U.S.C. 207) OR UNDER AN APPLICABLE STATE LAW, RECEIVES FROM THE APPLICA-
BLE EMPLOYER:
  (I) AN HOURLY COMPENSATION THAT IS LESS THAN THE LIVEABLE HOURLY RATE;
OR
  (II) AN ANNUAL COMPENSATION THAT IS EQUAL TO OR LESS THAN:
  (A) FOR THE FISCAL YEAR OF THE EFFECTIVE DATE OF THIS  ARTICLE,  THIR-
TY-ONE THOUSAND TWO HUNDRED DOLLARS PER YEAR; AND
  (B)  FOR EACH SUCCEEDING FISCAL YEAR, THE ADJUSTED AMOUNT DESCRIBED IN
SUBDIVISION THREE OF SECTION NINE HUNDRED FIFTY-ONE OF THIS ARTICLE; AND
  (B) DOES NOT INCLUDE ANY  SALARIED  EMPLOYEE  WHO  RECEIVES  FROM  THE
APPLICABLE  EMPLOYER  COMPENSATION  THAT, FOR TWO CONSECUTIVE MONTHS, IS
GREATER THAN:
  (I) FOR THE FISCAL YEAR OF THE EFFECTIVE DATE OF THIS ARTICLE,    FIVE
THOUSAND DOLLARS; AND
  (II) FOR EACH SUCCEEDING FISCAL YEAR, THE ADJUSTED AMOUNT DESCRIBED IN
SUBDIVISION THREE OF SECTION NINE HUNDRED FIFTY-ONE OF THIS ARTICLE.
  § 951. PROHIBITING COVENANTS NOT TO COMPETE FOR LOW-WAGE EMPLOYEES. 1.
NO EMPLOYER SHALL ENTER INTO A COVENANT NOT TO COMPETE WITH ANY LOW-WAGE
EMPLOYEE  OF  SUCH EMPLOYER, WHO IN ANY WORK WEEK IS ENGAGED IN COMMERCE
OR IN THE PRODUCTION OF GOODS FOR COMMERCE (OR IS EMPLOYED IN AN  ENTER-
PRISE ENGAGED IN COMMERCE OR IN THE PRODUCTION OF GOODS FOR COMMERCE).
  2. AN EMPLOYER WHO EMPLOYS ANY LOW-WAGE EMPLOYEE, WHO IN ANY WORK WEEK
IS ENGAGED IN COMMERCE OR IN THE PRODUCTION OF GOODS FOR COMMERCE (OR IS
EMPLOYED  IN  AN  ENTERPRISE ENGAGED IN COMMERCE OR IN THE PRODUCTION OF
GOODS FOR COMMERCE), SHALL POST NOTICE OF THE PROVISIONS OF THIS ARTICLE
IN A CONSPICUOUS PLACE ON THE PREMISES OF SUCH EMPLOYER.
  3. (A) FOR EACH FISCAL YEAR AFTER THE FISCAL  YEAR  OF  THE  EFFECTIVE
DATE  OF  THIS  ARTICLE,  THE  COMMISSIONER  SHALL ADJUST EACH AMOUNT IN
EFFECT UNDER SUBPARAGRAPH (I) OF PARAGRAPH (B) OF  SUBDIVISION  FOUR  OF
SECTION  NINE  HUNDRED FIFTY OF THIS ARTICLE, CLAUSE (B) OF SUBPARAGRAPH
(II) OF PARAGRAPH (A) OF SUBDIVISION FIVE OF SECTION NINE HUNDRED  FIFTY
OF  THIS  ARTICLE,  OR  SUBPARAGRAPH (I) OF PARAGRAPH (B) OF SUBDIVISION
FIVE OF SECTION NINE HUNDRED FIFTY OF  THIS  ARTICLE  FOR  INFLATION  BY
INCREASING EACH SUCH AMOUNT, AS IN EFFECT FOR THE PRECEDING FISCAL YEAR,
BY  THE ANNUAL PERCENTAGE INCREASE IN THE CONSUMER PRICE INDEX FOR URBAN
WAGE EARNERS AND CLERICAL  WORKERS  (UNITED  STATES  CITY  AVERAGE,  ALL

S. 4610                             3

ITEMS, NOT SEASONALLY ADJUSTED), OR ITS SUCCESSOR PUBLICATION, AS DETER-
MINED BY THE BUREAU OF LABOR STATISTICS.
  (B) THE AMOUNTS ADJUSTED UNDER PARAGRAPH (A) OF THIS SUBDIVISION SHALL
BE ROUNDED TO THE NEAREST MULTIPLE OF $0.05.
  §  952.  DISCLOSURE REQUIREMENT FOR COVENANTS NOT TO COMPETE. IN ORDER
FOR AN EMPLOYER TO REQUIRE AN EMPLOYEE, WHO IN ANY WORK WEEK IS  ENGAGED
IN  COMMERCE  OR IN THE PRODUCTION OF GOODS FOR COMMERCE (OR IS EMPLOYED
IN AN ENTERPRISE ENGAGED IN COMMERCE OR IN THE PRODUCTION OF  GOODS  FOR
COMMERCE)  AND  IS NOT A LOW-WAGE EMPLOYEE, TO ENTER INTO A COVENANT NOT
TO COMPETE, THE EMPLOYER SHALL, PRIOR TO THE EMPLOYMENT OF SUCH EMPLOYEE
AND AT THE BEGINNING OF THE  PROCESS  FOR  HIRING  SUCH  EMPLOYEE,  HAVE
DISCLOSED TO SUCH EMPLOYEE THE REQUIREMENT FOR ENTERING INTO SUCH COVEN-
ANT.
  §  953.  ENFORCEMENT.  1.  THE  COMMISSIONER  SHALL  HAVE THE POWER TO
RECEIVE, INVESTIGATE, ATTEMPT TO RESOLVE, AND ENFORCE A COMPLAINT  OF  A
VIOLATION  OF SECTIONS NINE HUNDRED FIFTY-ONE AND NINE HUNDRED FIFTY-TWO
OF THIS ARTICLE, SUBJECT TO SUBDIVISION TWO OF THIS SECTION.
  2. (A) THE COMMISSIONER SHALL IMPOSE A CIVIL FINE:
  (I) WITH RESPECT TO ANY  EMPLOYER  WHO  VIOLATES  SUBDIVISION  ONE  OF
SECTION NINE HUNDRED FIFTY-ONE OR SECTION NINE HUNDRED FIFTY-TWO OF THIS
ARTICLE, AN AMOUNT NOT TO EXCEED FIVE THOUSAND DOLLARS FOR EACH EMPLOYEE
WHO WAS THE SUBJECT OF SUCH VIOLATION; AND
  (II)  WITH  RESPECT  TO  ANY  EMPLOYER WHO VIOLATES SUBDIVISION TWO OF
SECTION NINE HUNDRED FIFTY-ONE OF THIS ARTICLE, AN AMOUNT NOT TO  EXCEED
FIVE THOUSAND DOLLARS.
  (B)  IN  DETERMINING  THE AMOUNT OF ANY CIVIL FINE UNDER THIS SECTION,
THE COMMISSIONER SHALL CONSIDER THE APPROPRIATENESS OF THE FINE  TO  THE
SIZE  OF THE EMPLOYER SUBJECT TO SUCH FINE AND THE GRAVITY OF THE APPLI-
CABLE VIOLATION.
  § 3. This act shall take effect immediately and shall apply to employ-
ees hired on and after such date.