SF 304 – Iowa

Status: In Process
Year Introduced: 2024
Link: https://www.legis.iowa.gov/legislation/BillBook?ga=90&ba=SF304

This bill aims to regulate noncompete covenants – agreements that restrict employees from working for a competing employer for a certain period after leaving their current jobs – by putting certain restrictions. For instance, if an employee makes less than 150 percent of the minimum wage, a noncompete covenant is not enforceable. Also, such a covenant with a non-low-wage employee is unenforceable unless the employer can prove the covenant is necessary due to a significant risk of unfair competition and that the covenant has been tailored specifically to mitigate this risk. The bill also prescribes penalties for employers violating these terms, including having them pay for attorney fees, court costs, lost wages, and other damages if the violation is willful, to the impacted employees. These employers could also be fined $5,000 per violation payable to the labor commissioner. This bill only applies to noncompete covenants entered after its effective date.

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