2023 District of Columbia Code › Title 32 - Labor › Chapter 5B - Ban on Non-compete Agreements › § 32–581.01. Definitions

§ 32–581.01. Definitions.
For the purposes of this chapter, the term:
(1) "An Act" means Chapter 13 of this title.
(2) "Broadcast employee" means an on- or off-air creator (such as an anchor, disc jockey, editor, producer, program host, reporter, or writer) of a legal entity that owns or operates one or more of the following:
(A) A television station or network;
(B) A radio station or network;
(C) A cable station or network;
(D) Satellite-based services similar to a broadcast station or network; or
(E) Any other entity that provides broadcasting services such as news, weather, traffic, sports, or entertainment programming.
(3) "Compensation" means all monetary remuneration an employer may pay or promise an employee.
(A) The term includes:
(i) Hourly wages;
(ii) Salary;
(iii) Bonuses or cash incentives;
(iv) Commissions;
(v) Overtime premiums;
(vi) Vested stock, including restricted stock units; and
(vii) Other payments provided on a regular or irregular basis.
(B) The term does not include fringe benefits other than those paid to the employee in cash or cash equivalents.
(4) "Confidential employer information" means information owned or possessed by the employer that is not available to the general public and that the employer has taken reasonable steps to ensure is protected from improper disclosure.
(5) "Conflict of commitment" means conduct that would compromise the ability of an employee of a higher education institution to perform employment duties for the institution because the activities risk interfering with the employee's primary duties for the institution.
(6) "Covered employee" means an employee who is not a highly compensated employee and:
(A) If the employee has commenced work for the employer:
(i) Spends more than 50% of his or her work time for the employer working in the District; or
(ii) Whose employment for the employer is based in the District and the employee regularly spends a substantial amount of his or her work time for the employer in the District and not more than 50% of his or her work time for that employer in another jurisdiction; or
(B) If not yet commenced work for the employer:
(i) Has an employer that reasonably anticipates that the employee will spend more than 50% of his or her work time for the employer working in the District; or
(ii) Whose employment for the employer will be based in the District and the employer reasonably anticipates that the employee will regularly spend a substantial amount of his or her work time for the employer in the District and not more than 50% of his or her work time for that employer in another jurisdiction.
(7) "Employee":
(A) Means:
(i) An individual who performs work for pay in the District on behalf of an employer; or
(ii) An individual to whom the employer has made an offer of employment and whom an employer reasonably anticipates will perform work for pay on behalf of the employer in the District.
(B) The term does not mean:
(i) An individual employed as a casual babysitter in or about the residence of the employer; or
(ii) A partner in a partnership.
(8) "Employer" means an individual, partnership, general contractor, subcontractor, association, corporation, or business trust operating in the District, or any person or group of persons acting directly or indirectly in the interest of an employer operating in the District in relation to an employee, including a prospective employer. The term does not mean the District government or the United States government
(9) "Higher education institution" means a postsecondary educational institution accredited by an agency that the United States Department of Education recognizes as an accrediting agency.
(10) "Highly compensated employee" means, other than a broadcast employee, an employee:
(A) Who is reasonably expected to earn from the employer in a consecutive 12-month period compensation greater than or equal to the minimum qualifying annual compensation; or
(B) Whose compensation earned from the employer in the consecutive 12-month period preceding the date on which the proposed term of non-competition is to begin is greater than or equal to the minimum qualifying annual compensation.
(11) "Long-term incentive" means bonuses, equity compensation, stock options, restricted and unrestricted stock shares or units, performance stock shares or units, phantom stock shares, stock appreciation rights, and other performance driven incentives for individual or corporate achievements typically earned over more than one year.
(12) "Medical specialist" means a highly compensated employee who is engaged primarily in the delivery of medical services and who:
(A) Holds a license to practice medicine;
(B) Is a physician
;
(C) Has completed a medical residency; and
(D) Receives total compensation in the amount equal to or greater than $ 250,000.
(13) "Minimum qualifying annual compensation" means:
(A) Beginning with the calendar year in which this chapter becomes applicable:
(i) $150,000; or
(ii) $250,000, if the employee is a medical specialist.
(B) For the calendar year beginning January 1, 2024, and each calendar year thereafter, an amount equal to the previous calendar year's minimum qualifying annual compensation, increased in proportion to the annual average increase, if any, in the Consumer Price Index for All Urban Consumers in the Washington Metropolitan Statistical Area published by the Bureau of Labor Statistics of the United States Department of Labor for the previous calendar year adjusted to the nearest whole dollar.
(14) "Non-compete agreement" means a contract between an employer and employee that has one or more non-compete provisions.
(15) "Non-compete provision" means a provision in a written agreement or a workplace policy that prohibits an employee from performing work for another for pay or from operating the employee's own business. The term "non-compete provision" does not include an otherwise lawful provision:
(A) Contained within or executed contemporaneously with an agreement between the seller of a business and one or more buyers of that business wherein the seller agrees not to compete with the buyer's business;
(B) That prohibits or restricts an employee from:
(i) Disclosing, using, selling, or accessing the employer's confidential employer information or proprietary employer information;
(ii) Accepting money or a thing of value for performing work for a person other than the employer, during the employee's employment with the employer, because the employer reasonably believes the employee's acceptance of money or a thing of value under such circumstances will:
(I) Result in the employee's disclosure or use of confidential employer information or proprietary employer information;
(II) Conflict with the employer's, industry's, or profession's established rules regarding conflicts of interest;
(III) Constitute a conflict of commitment if the employee is employed by a higher education institution; or
(IV) Impair the employer's ability to comply with District or federal laws or regulations; a contract; or a grant agreement; or
(C) That provides a long-term incentive.
(16) "Proprietary employer information" means information unique to an employer that is compiled, created, or solicited by the employer, including customer lists, client lists, and trade secrets as that term is defined in § 36-401(4).
(17) "Retaliate" means to take an adverse action, including a threat, verbal warning, written warning, reduction of work hours, suspension, or termination against one or more employees.
(18) "Term of non-competition" means the period of time specified in a non-compete provision during which the employee's work for a person other than the employer is prohibited.
(19) "Workplace policy" means the rules and restrictions, whether written or as a matter of practice, implemented by an employer to govern the conduct of the employer's employees.
(Mar. 16, 2021, D.C. Law 23-209, § 101, 68 DCR 000782; Sept. 21, 2022, D.C. Law 24-175, § 2(a), 69 DCR 009910.)
Applicability
Section 2 of D.C. Law 24-132 amended section 302 of D.C. Law 23-209 to provided that the creation of of this section shall apply as of October 1, 2022.
Section 2 of D.C. Act 24-455 amended section 302 of D.C. Law 23-209 to provided that the creation of this section shall apply as of October 1, 2022.
Section 2 of D.C. Act 24-350 amended section 302 of D.C. Law 23-209 to provided that the creation of this section shall apply as of October 1, 2022.
Section 7202 of D.C. Law 24-45 amended section 302 of D.C. Law 23-209 to provided that the creation of this section shall apply as of April 1, 2022.
Section 7202 of D.C. Act 24-159 amended section 302 of D.C. Law 23-209 to provided that the creation of this section shall apply as of April 1, 2022.
Applicability of D.C. Law 23-209: § 302 of D.C. Law 23-209 provided that the creation of this section by § 101 of D.C. Law 23-209 is subject to the inclusion of the law’s fiscal effect in an approved budget and financial plan. Therefore that amendment has not been implemented.
Emergency Legislation
For temporary (90 days) amendment of this section, see § 101 of Non-Compete Clarification Emergency Amendment Act of 2022 (D.C. Act 24-552, Aug. 15, 2022, 0 DCR 0).