On March 24, 2022, a new bill affecting restrictive employment agreements or covenants not to compete was introduced in the Colorado House of Representatives. The bill has been assigned to the House Judiciary Committee. If passed, the bill would make additional changes to the Colorado statute governing restrictive employment agreements. A copy of the bill’s text is included here. Colorado employers should take note of this development and should work with qualified counsel to review all restrictive employment agreements they may currently have in place or may be contemplating. If a version of this bill becomes law, it could significantly alter the types of agreements to which the statute applies as well as several of the exceptions in the current statute. In its current form, the bill also clarifies the penalties for violations of the statute—including the recent addition of a criminal penalty and the addition of a civil penalty. The bill would also create a notification procedure when an employer seeks to enter into a restrictive employment agreement with an employee and would limit choice of law and choice of venue provisions in such agreements. Contact Katie Pratt for more information. Ms. Pratt’s practice focuses on defense-side employment litigation, civil rights, and employment advising to Colorado businesses.
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