2nd Session, 43rd Legislature
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Bill 213
THE EMPLOYMENT STANDARDS CODE AMENDMENT ACT (NON-COMPETE AGREEMENTS)
| Bilingual version (PDF) | Explanatory Note |
(Assented to )
HIS MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:
C.C.S.M. c. E110 amended
1 The Employment Standards Code is amended by this Act.
2 The following is added as Part 2.1:
PART 2.1
NON-COMPETE AGREEMENTS
Definitions
85.1 The following definitions apply in this Part.
"non-compete agreement" means an agreement, or any part of an agreement, between an employer and an employee that prohibits the employee from engaging in any business, work, occupation, profession, project or other activity that is in competition with the employer's business after the employment relationship between the employee and the employer ends. (« accord de non-concurrence »)
"sale" includes a lease. (« vente »)
Prohibition against non-compete agreements
85.2(1) An employer must not enter into a non-compete agreement with an employee or prospective employee.
Non-compete agreements invalid and unenforceable
85.2(2) A non-compete agreement entered into after this section comes into force is invalid and unenforceable.
Exception — executives
85.3(1) This Part does not apply to an employee or prospective employee who holds the office of chief executive officer or president or another prescribed executive position.
Exception — sale of business
85.3(2) This Part does not apply to a non-compete agreement between a purchaser of a business and the seller of the business if
(a) as part of the sale, the purchaser and seller agreed that the seller would not engage in any business, work, occupation, profession, project or other activity that is in competition with the purchaser's business after the sale; and
(b) the seller becomes an employee of the purchaser immediately after the sale.
Coming into force
3 This Act comes into force on the day it receives royal assent.
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Explanatory Note A non-compete agreement prohibits an employee from competing with their employer after the employment relationship ends. The Employment Standards Code is amended to prohibit non-compete agreements. The prohibition does not apply to an employee who is a senior executive or to a person who, after selling a business, becomes an employee of the purchaser of the business. |