Enacts the "fair broadcast employment act of 2014" to authorize the use of certain contract provisions for the employment of key employees in the broadcast industry

Summary of specific provisions

Section 1: provides that this act shall be known and may be cited as the "Pair Broadcast Employment Act of 2014."

Section 2(a) clarifies the definitions in the current section 202(k) (1) (a) making it clear that each individual broadcast station and network entity falls within the scope of the legislation.

Section 2(b) No change for existing law

Section 2(c) amends section 202(k) by creating a new category of "key" employees that will be allowed to negotiate with broadcast industry employers for post contract term covenants not to compete. Under this provision, a "key employee" is defined as either:(1) compensated in the highest 10% of all non management employees employed by the broadcast industry employer in New York, or (2) is one of five (5) designated key non-management positions employed by the broadcast industry employer in New York, provided the employer has notified the employee of that designation.

Section 2. (A) amends current section 202(k) by exempting key employees from the limitations contained in the provision

Section 3: amends section 3 by clarifying that the provisions of that section do not apply to non-managerial key employees, as defined in section 2(c) of a broadcast industry employer.

Section 4: adds a new provision clarifying Section 202(k) to make it clear that the section does not limit in any way provisions relating to post-contract: (a) right of first refusal or right to match, (b) periods for exclusive negotiations, or (c) confidentiality/non-disclosure provisions in any employment contract.

Section 5: Existing section 202(k) (5) is retained. The existing enforcement provisions, indicating that violators may be civilly liable to a broadcast employees for damages, attorney's fees and costs, remain the same.

Justification

Under current Section 202(k), all employees and broadcast industry employers may negotiate for covenants not to compete during the term of the employment contract as part of the underlying employment contract. Such provisions remain subject to the "reasonableness"

requirements as determined by New York Common Law. This freedom is not extended to post contract term covenants not to compete, which are prohibited where they are part of the underlying employment agreement.

The proposed bill creates a limited exception to the prohibition on post contract term covenants not to compete for "key non-management employees." Under the legislation, these key employees and employers would be able to negotiate a post contract covenant not to compete as part of the underlying employment contract. Key non-management employees are defined as 1) non-management employees compensated in the highest 10% of all non-management employees employed by the broadcast industry employer in New York, or (2) one of five (5) designated-key non-management positions employed by the broadcast industry employer in New York, provided the employer has notified the employee of that designation. This limited class of employees would be free to negotiate such provisions with a broadcast industry employer. Importantly, the post contract term covenants not to compete would still remain subject to the standards applicable under New York Common Law.

The impact of this minor change will be minimal. The overwhelming majority of broadcast industry employees, i.e., 90%, would remain subject to the existing limitations of Section 202(k). The legislation is designed to affect only those "key" non-management employees who generally are in a position to negotiate with their respective broadcast industry employers. Moreover, post contract term covenants not to compete remain subject to the standards of New York common law. These standards govern nearly all employment contracts in the state of New York. The current law, Section 202(k), was enacted in 2008. It is an exception from the common law governing labor contracts, and uniquely singles out broadcast industry employers and employees. No other industry or profession is subject to such a unique limitation.

The proposed bill also clarifies existing law with respect to several provisions that are common in current employment contracts including: (1) the right of first refusal or right to match, (2) periods for exclusive negotiations, or (3) confidentiality/nondisclosure provisions in any employment contract. The bill simply clarifies that Section 202(k) never intended to limit the use of these provisions.

Prior legislative history

S.6277, A.8236 2012

Fiscal implications for state and local governments

None to the State.

Effective date

Immediately.