Utah House Speaker Greg Hughes and State Rep. Mike Schultz discuss the passage of HB241 – a new state law designed to stem the abuse of noncompete clauses in broadcast workers’ employment contracts. Photo:Gephardt Daily/Steve Milner
SALT LAKE CITY, Utah, March 27, 2018 (Gephardt Daily) — Utah’s governor Gary Herbert has signed a controversial bill limiting the use of employee noncompete clauses by local broadcasting outlets.
House Bill 241 was introduced by Utah State Rep. Mike Schultz, R-Hooper and survived scrutiny before committees in both the House and Senate before heading to the governor’s desk.
House Speaker Greg Hughes, R-Draper, a key player in driving the bill, said Tuesday it was one of the toughest political challenges of his career.
“I think we’re standing up for the little guy,” Hughes said. “Life is a two way street and you should treat it that way and I think those employers should be able to hire and fire as they feel is beneficial to their business and the employees that work there, but certainly people should be able to find gainful employment where they think they’re qualified and where people would be willing to hire them.”
HB241 outlaws noncompetes for staff members earning less than $47,500 per year. It also allows contract players to accept employment with rival stations as soon as those contracts expire. Most current noncompetes prevent workers from accepting employment for at least a year after separation.
Proponents of the bill — including longtime investigative reporter and consumer advocate Bill Gephardt, owner of Gephardt Daily, testified before committees in the House and Senate that noncompetes are intrinsically unfair, abridging the rights of workers — both on-air and behind-the-scenes — from accepting gainful employment at rival outlets, even when they are separated and no longer being paid by their former employers.
Gephardt said forcing ex-employees to leave the market to earn a living in their chosen field is “one-sided and perverted. If you’re not going to pay me, let me go to find a job to support myself and my family,” he said.
Those favoring noncompetes, including top managers of KUTV, KSTU, KTVX, KSL and Deseret Management Corporation, argued the clauses safeguard their companies’ longterm investments in the development and promotion of branded on-air talent. They said the same is true for other key personnel who have critical knowledge of the stations’ operations and strategic planning.
Bob Evans, 22-year-veteran anchor for KSTU also spoke against the measure.
“Great time, energy, effort and money are put into developing a station’s image, much of it surrounding the people, such as myself, who become the face of the station,” Evans said. “Protecting a station’s investment in its people, product and credibility are a legitimate concern.”
Other critics of HB241 sighted First Amendment concerns, arguing that the specific targeting of media outlets raised questions about legislation which restricted long-accepted business practices of the free press. Wording of the bill was ultimately amended to reflect those concerns, limiting its scope to “broadcast companies” only.
In an interview Tuesday afternoon sponsor Mike Schultz expressed his gratitude to those who supported the bill.
To hear reaction from Rep. Schultz and House Speaker Greg Hughes and click on the video player above.