BURLINGTON, Vt. — On April 18, legislative intern Helen Argrace told the House Commerce and Economic Development Committee she had compiled court decisions and state statutes showing how courts and legislatures have treated noncompete agreements in franchise and health-care settings.

Argrace said she focused on franchise-specific cases and a set of recent state laws affecting health-care practitioners. "For the record, my name is Helen Argrace. I'm the legislative intern for the committee," she began, and summarized examples from Wisconsin, Kansas and California before outlining statutes in Pennsylvania, Connecticut, Illinois, Iowa, Louisiana, Maryland, New Mexico and Kentucky.

The overview matters because noncompete provisions can affect where health-care practitioners may work and, in turn, patients’ access to care. Argrace noted that some states now limit or void noncompetes for health-care workers to reduce barriers to care and increase competition among providers.

Argrace described a 2003 Wisconsin decision in which a court declined to apply the state's statute narrowly written for employment relationships and instead used common-law analysis; the court upheld contractual limits that prohibited competition within 45 miles of the franchise territory for one year. By contrast, she cited H&R Block v. Lovelace (Kansas, 1972), where a five-year post-termination restriction without any geographic scope was held unreasonable and unenforceable because it could be read to bar competition worldwide. She also referenced a February case cited on a law-firm website, California Pizza Kitchen Inc. v. Mangual, in which a California court applied that state's noncompete law and struck a franchise noncompete; Argrace said she was still locating the full opinion.

On statutes, Argrace summarized several state approaches:
- Pennsylvania's Fair Contracting for Health Care Practitioners Act (effective Jan. 1) generally voids post-enactment noncompetes for health-care practitioners and, where permitted, limits a covenant not to exceed one year; it also requires notice to patients who have seen the practitioner for two consecutive years that the practitioner is leaving and how patients may transfer records or follow the practitioner.
- Connecticut's law governing physician covenants (effective July 1, 2023) places the burden of proof on the party seeking enforcement and caps enforceable covenants at one year and a 15-mile radius.
- Illinois adopted provisions making noncompetes unenforceable for licensed professionals providing mental-health services to veterans and first responders if signed after Jan. 1, 2025.
- Iowa's recent act bars health-care technology platforms from restricting independent nursing professionals' employment opportunities via noncompetes.
- Louisiana's provisions limit noncompetes for primary care physicians, providing that noncompetes expire three years from their effective date and that, if the employment relationship terminates within three years, the noncompete's scope must be limited to two years and to the parish where the practice is located.
- Maryland's provisions void noncompetes for veterinarians and health-care professionals earning less than $350,000 annually; for direct-care health professionals earning more than $350,000, noncompetes may be limited to one year and a 10-mile radius.
- New Mexico's statute limits enforcement in certain cross-jurisdictional situations, and Kentucky restricts noncompetes for temporary direct-care staff but not permanent staff, Argrace said.

Committee members asked for the materials in spreadsheet form so they could compare duration, geographic scope and income/position exceptions across states. One member observed, "I found it interesting that when they didn't mention a geographic area, it actually worked against them," referring to the H&R Block decision. Argrace said she planned a side-by-side table linking statutes and cases and to include distinctions such as partner/owner/director classifications and income thresholds.

The committee did not take formal action on noncompete policy at this meeting. Members noted procedural business: the committee planned to reconvene after the House floor session for a markup of Senate Bill 117, "Act relating to rulemaking on safety and health standards and technical corrections to employment practices and unemployment compensation," with the stated goal of finishing by noon.

Argrace closed by saying she would assemble the spreadsheet and supporting links to cases and statutes and take questions about next steps. "That is all that I have for you today. I'm happy to take any questions," she told members.

The briefing supplies committee members with comparative state models and case law as they consider whether Vermont should pursue targeted limits on noncompete agreements for franchises or health-care practitioners.