So, your news anchor or morning drive host is hugely popular in the market, and her employment contract is about to expire. Your competition would love for her to join its team, and is willing to pay her more. When re-negotiating her contract you should include a non-compete clause, right? Maybe not. A number of states, including Arizona, Connecticut, the District of Columbia, Illinois, Maine, Massachusetts, New York, Oregon, and Washington have passed laws that restrict the ability of broadcast employers to prevent their employees from going to work for the competition.
Massachusetts was the first state to enact legislation banning non-compete agreements for broadcast employees. The law forbids any contract or agreement that “restricts the right of [an] employee … to obtain employment in a specified geographic area for a specified period of time after termination of employment.” Massachusetts’ law applies to television and radio station employees as well as employees of “any entities affiliated with the foregoing.” The ban is not without exception, however – non-competes may be enforced against employees who resign voluntarily mid-way through their employment term without consent of their employer.
New York is the latest state to enact a broadcast non-compete ban. Under New York’s law, broadcast employers are prohibited from restricting an employee’s ability to obtain employment in a specified geographic area, for a specific period of time, or with a particular employer or industry. The prohibition applies not only to on-air personalities, but to off-air employees (excluding “management employees”) in television, radio, cable, and “internet or satellite-based services similar to a broadcast station.” Employees of “any other entity that provides broadcasting services such as news, weather, traffic, sports, or entertainment reports or programming” are also included within the ambit of the prohibition. Like most of the statutes banning non-competes, New York’s law is primarily concerned with restrictive covenants that continue to bind the employee after his or her employment with a particular broadcaster has ended; the law does not prevent a broadcast employer from restricting its employee from working for the competition during the term of his or her employment contract.
Even if not located in a state with an express statutory prohibition on broadcast non-competes, broadcast employers should be aware that the law generally tends to disfavor non-competes, particularly those that restrict a former employee from working for the competition for a long period of time or within a wide geographic area. Nevertheless, employers trying to limit their employees’ ability to move to competitors may be able to protect themselves using alternative methods, such as a result of first refusal (which requires an employee to inform her current employer of the compensation being offered by a competitor) or exclusivity provisions. Broadcasters should consult with competent legal counsel to discuss these and other options.