Contracts

On January 5, 2023, the Federal Trade Commission (FTC) announced a proposed regulation that would completely prohibit non-competition agreements in the workplace.  A non-compete clause is a contractual term between an employer and worker that prevents the worker from seeking or accepting certain employment, or operating certain businesses, after the worker’s employment ends.  Previously, the FTC issued a statement in November 2022 in which it declared its intention to exercise authority under Section 5 of the FTC Act which would be in line with President Biden’s Executive Order from July 2021 urging the FTC to promulgate new rules governing non-competes.  If this were to happen, the consequences for both employers and employees would be significant.

With certain exceptions, the proposed rule would make it illegal to (1) enter into or attempt to enter into a noncompete with a worker, (2) maintain a noncompete with a worker, and (3) represent to a worker that the worker is subject to a noncompete agreement.
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Massachusetts wage and hours laws provide employers with guidance as to how, when, and how much workers must be paid.  One common issue that arises is when and what employees that resign or are terminated need to be paid.  Generally speaking, an employee is voluntarily quits or resigns may be paid on the next regular pay date after his or her last day of work but an employee who is involuntarily terminated must be paid in full on the day of discharge.  Failing to adhere to these rules can have significant consequences.

Massachusetts General Laws chapter 149 § 148 states “any employee discharged from such employment shall be paid in full on the day of his discharge.
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When Governor Charlie Baker prohibited restaurants from letting customers eat or drink indoors and ordered the temporary closure of “non-essential” businesses via Order No. 13 on March 23, 2020, it was known that there would be extensive implications of that decision for many businesses.  Some businesses have shuttered completely while others have successfully launched profitable curbside or take out businesses.  One issue that was not addressed in March of 2020 was what are the rights and responsibilities for landlords and tenants of commercial leases.  It took nearly a year, but the first major decision surrounding the issue was made on February 8, 2021.
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On March 11, 2020, the World Health Organization declared the novel coronavirus (more commonly known as COVID-19) to be a pandemic.  For many Americans, this was their first experience with a disease that had a power to disrupt life on such a global scale.  Many of us had watched movies such as Contagion or Outbreak, and thought those we were scary, but unlikely, stories.  In the world of commercial and contract law, there is a term of art that is often thrown about but not very often utilized: force majeure.

A force majeure event involves an occurrence which is outside the reasonable control of a party and which prevents a party from performing his, her, or its obligations under an otherwise valid contract.
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Contractors hired to work on a residential home in the Commonwealth of Massachusetts must provide written contracts with required information provided if the amount of the work will exceed one thousand dollars.  In fact, so-called "handshake deals", verbal agreements, or simple invoice contracts more likely than not will violate Massachusetts General Laws Chapter 142A.

In 1992, the Massachusetts legislature passed the Home Improvement Contractor Law which became Massachusetts General Laws chapter 142A.  This law lays the foundation for agreements between contractors and homeowners when the value of the work being performed will exceed one thousand dollars.

A firm understanding of this law (as well as the requirements of a contract) will help protect both the homeowner and the contractor.
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