Legislative Update: Florida, Indiana

Case Law Update

No case law update.

Legislative Update

Florida - H1219

Action: Passed

BPB Summary: (1) Provides that a "covered garden leave agreement" and “covered noncompete agreement” (as defined in the Act) of up to four years is not a restraint on trade, provided that (a) it applies to a “covered employee,” defined as one who earns or is reasonably expected to earn a salary greater than twice the annual mean wage of the Florida county in which the covered employer has its principal place of business, or the Florida county in which the employee resides if its principal place of business is not in Florida, (b) a covered employee is provided with proper notice of the garden leave agreement before its execution, (c) after the first 90 days of the notice period, the employee does not have to provide services to the employer, (d) the employee may perform nonwork activities at any time after the first 90 days of the notice period, (e) during the remainder of the notice period, the employee may still work for another employer while employed by the covered employer with the covered employer's permission, and (f) the notice period may be reduced if the covered employer provides at least 30 days’ advance written notice. (2) Excludes from the definition of “covered employee” health care practitioners as defined in s. 456.001. (3) Requires 7 days' notice to prospective and current employees and a written acknowledgement signed by the employee that they were advised of the right to seek counsel before entering into the agreement. (4) Requires that courts issue injunctive relief to employers for breach of covered garden leave agreements and covered noncompete agreements, unless the employee, or the business or individual seeking to employ the covered employee, can demonstrate by clear and convincing evidence that (a) the employee is not providing the same or similar services they provided to their employer within the last 3 years of employment, or using confidential information or customer relationships of the covered employer, (b) the business seeking to employ the covered employee is not engaged in or planning or preparing to engage in a similar business, or (c) that the employer has failed to compensate them under the agreement. (5) Allows for the prevailing party in any action to enforce this section to recover reasonable attorney fees and costs. (6) Allows employers to reduce salary or benefits if an employee commits gross misconduct. (7) Takes effect July 1, 2025.

Indiana - SB0475

Action: Passed

BPB Summary: (1) For purposes of Indiana's existing law regulating non-competes with respect to physicians, defines "non-compete" to include “any part of a contract, to which a physician is a party that has the purpose or effect of restricting or penalizing a physician's ability to engage in the practice of medicine in any geographic area, for any period of time, after the physician's employment relationship…has ended.” (2) Includes in the definition of non-compete a contract or a contract provision between a physician and the physician's employer that (a) prohibits the physician or imposes indirect restrictions on the physician from engaging in the practice of medicine with a new employer; (b) imposes financial penalties on (i) a physician that has been employed by a hospital, parent company of the hospital, affiliated manager of a hospital, or hospital system for at least three years, or (ii) that are based solely or primarily on the decision to practice medicine with a new employer; or (c) requires the physician to consent to equitable relief or obtain employer consent in order to engage in the practice of medicine with a new employer, regardless of geographic area or specialty. (3) Excludes (a) employee non-solicitation covenants that are no longer than one year, provided that the covenant does not restrict the physician’s (i) patient relationships or referrals, (ii) clinical collaboration, or (iii) professional relationships; (b) non-competes entered into in the sale of business context; and (c) non-disclosure agreements. (4) Defines "originally entered into" as the time an agreement was first executed, which does not include amendments or renewals. (5) Prohibits a physician and either a hospital, parent company of a hospital, an affiliated manager of a hospital, or a hospital system (as defined in the Act) from entering into a noncompete agreement on or after July 1, 2025.

Regulatory Update

No regulatory update.