2017 Utah Legislative Session Outlook

The 2017 Utah Legislative Session began today and will run through March 9, 2017. Although top priorities for this legislative session appear to revolve around education, taxes, and the budget, the Legislature is expected to debate a number of bills that directly impact Utah employers. Here is a list of bills to keep on your radar:

HB 81, Post-employment Restrictive Covenant Act Amendments. HB 81 seeks to amend the controversial Post-employment Restrictive Covenant Act that was signed into law during the 2016 legislative session. Due to the controversial nature of noncompete agreements in the workplace, the Post-employment Restrictive Covenant Act caught the eye of the business community. This is still a deeply divisive issue, and we’ve been hearing for months that the fight has only just begun. HB 81, if passed, would require employers to provide additional “consideration,” such as an increase in wages, or a promotion, in order to create an enforceable noncompete agreement between the employer and an existing employee. HB 81 would also render noncompete agreements unenforceable against the employee if the employer terminated the employee’s employment within one year of the date the employee signed the noncompete agreement. Finally, HB 81 would preclude employers from bringing an action to enforce the noncompete after the date the noncompete period expires. HB 81 would leave in place any of the requirements imposed under common law.

HB 147, Amendments to the Minimum Wage. For several years in a row, Representative Lynn Hemmingway has introduced legislation to raise Utah’s minimum wage. In past years, this push has failed to gain traction and the approval of Utah legislators. Will this year be any different? HB 147 proposed to introduce an annual adjusting scale that would raise the minimum wage to $10.25 per hour on or after July 1, 2017, $11.20 per hour on or after July 1, 2018, $12.15 per hour on or after July 1, 2019, $13.10 per hour on or after July 1, 2020, $14.05 per hour on or after July 1, 2021, and $15 per hour on or after July 1, 2022. HB 147 would also raise the cash wage obligation for a tipped employee in the state to $5 per hour.

HB 156, State Job Application Process. HB 156 is essentially a “Ban-the-Box” proposal for public employers. It would provide that a public employer in the state of Utah, including the state, any sub-unit of the state, department, division, board, council, committee, institution, office, bureau, state institution of higher education, municipal corporation, county, municipality, school district, local district, special service district, or any other political subdivision of the State of Utah may not require an applicant to disclose a past criminal conviction before an initial interview for employment. Public employers would also be precluded from excluding an applicant from an initial interview because of a past criminal conviction. Public employers would not be prohibited from asking about an applicant’s criminal conviction during or after an initial interview, or from considering the applicant’s conviction history when making a hiring decision. HB 156 does, however, exempt certain public employers from these requirements, including law enforcement agencies, employers that are part of the criminal justice system, or public employers seeking a non-employee volunteer, if local, state, or federal law requires the consideration of an applicant’s criminal conviction history.

This is not intended to be an all-inclusive list of bills which may affect Utah employers. As the session progresses, new bills, and amendments to these bills will be introduced. If you have questions about how these, or other bills that the Utah State Legislature has introduced may affect your organization, contact your MSEC representative.