Trade Secrets & Employee Mobility

We recently reported that Kansas was in a minority of states to enact employer-friendly restrictive covenant legislation.  Florida is on the verge of joining Kansas following the introduction of House Bill 1219 (“HB 1219”), which creates, in part, the “Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act”. If enacted, HB 1219 will provide a framework for the use of permissible noncompete and garden leave agreements between a covered employer and covered employee. If passed, the bill would strengthen the enforceability of noncompete and/or garden leave agreements.

HB 1219 outlines certain noncompete and garden leave agreement requirements, such as confidentiality access and notice periods, to accept such agreements as enforceable. So long as the requirements are met, noncompete and garden leave agreements will not be considered a restraint of trade or an attempt to monopolize trade or commerce in violation of public policy. On April 23, 2025, the House voted 91-21 to pass HB 1219, and a day later, the Senate voted 28-9 to pass BH 1219. As of April 24, 2025, the bill was ordered and enrolled.

Consistent with our previous reporting that states would continue to address noncompete issues even after the apparent end of the FTC Noncompete Rule, Kansas has joined the growing list of jurisdictions to pass or introduce legislation addressing restrictive covenants.  The difference between Kansas and the other states’ legislation and proposed legislation is that Kansas’s legislation is employer friendly.

On April 8, 2025, Kansas enacted a law “concerning restraint of trade; relating to restrictive covenants; providing that certain restrictive covenants are not considered a restraint of trade and shall be enforceable; amending K.S.A. 2024 Supp. 50-163” (the “Kansas Law”).  Pursuant to the Kansas Law, Kansas’s “restraint of trade act shall not be construed to apply to … any franchise agreements or covenants not to compete.” 

Although the Kansas Law sets forth requirements for non-solicit provisions (as discussed below), it does not place requirements or restrictions on the use of noncompetes.  Thus, it is likely that noncompetes will continue to be enforced consistent with Kansas case law.  The “freedom to contract” and “wide discretion” for parties to entered into employment agreements “extends to restrictive covenants in employment contracts.  Doan Family Corp. v. Arnberger, 522 P. 3d 364, 369-70 (Kan. App. 2022) (citing Foltz v. Struxness, 215 P. 2d 133 (Kan. 1950)).  Under Kansas law, “noncompete agreements are ‘valid and enforceable if the restraint on competition is reasonable under the circumstances and not adverse to the public welfare.’” Id. at 370 (quoting Weber v. Tillman, 913 P. 2d 84 (Kan. 1996)).