Missouri Passes Bill Restricting Nonsolicitation Agreements
Missouri lawmakers recently passed Senate Bill 103, which is designed to restrict the time and scope of covenants between a business entity and an “owner”. This bill is intended to limit the ability of businesses to make certain types of agreements with their owners, including nonsolicitation agreements.
Nonsolicitation agreements are legally binding contracts between a business and an owner that typically involve a promise from the owner not to solicit or interfere with the business’s employees or customers after the owner’s relationship with the business ends. Nonsolicitation agreements are a common business practice, as they are used to protect the business’s interests and protect against unfair competition.
In passing Senate Bill 103, Missouri lawmakers have significantly limited the scope and duration of nonsolicitation agreements. The bill states that a nonsolicitation agreement must specify a “reasonable” time period, which cannot exceed two years. It also restricts the agreement to a “narrowly defined geographic area”, which cannot exceed a 25-mile radius from the business’s primary place of business.
The passage of this bill has significant implications for businesses in Missouri. Business owners should be aware of the new restrictions and take steps to modify any existing nonsolicitation agreements to ensure they comply with the new law.
For HR professionals, this new law serves as an important reminder that it is essential to stay abreast of the latest developments in employment law. HR professionals should be aware of the new restrictions in Missouri and ensure that any nonsolicitation agreements that the company uses comply with the new law.
It is also important for HR professionals to be aware of the potential risks of using nonsolicitation agreements. While such agreements can be a useful tool in protecting the business’s interests, they can also be subject to legal challenge. This is especially true in states like Missouri, which has now taken steps to restrict the scope and duration of these agreements.
Ultimately, HR professionals should be aware of the new restrictions in Missouri and take steps to ensure that any nonsolicitation agreements used by the company comply with the new law. At the same time, they should also be aware of the potential risks associated with such agreements and take steps to ensure that they are being used in a way that is legally compliant.
