State, Local Laws on Noncompetes, Paid Parental Leave and NLRB Substitution

In local law updates, several states are considering National Labor Relations Board (NLRB) “trigger” laws, Florida bucked the trend of prohibiting noncompete agreements, and New York City has mandated paid prenatal leave.

For several months, the NLRB has operated without a quorum after the change in federal administration. In response, California, Massachusetts and New York are all considering laws that would allow the state to regulate private sector labor claims if certain conditions are met.

For example, California’s would apply where an employee loses access to “an independent, effective and functioning legitimate and expert” NLRB due to a lack of quorum or lack of funding, or where the worker tries to protect their rights under the National Labor Relations Act (NLRA), but the Board fails to provide a determination after a certain period.

The measure would authorize the state’s Public Employment Relations Board (PERB) to decide unfair labor practice cases and order all appropriate relief for a violation, including civil penalties.

“Although California recognizes that it cannot take away rights granted to employees under the NLRA, California also recognizes that existing federal law cannot prevent it from doing its part to enforce and further the rights recognized by the NLRA, which stem from individual’s inherent sovereignty and from the United States and California Constitutions,” according to the bill.

AB 288 passed the Assembly in June and is currently being reviewed in the Senate.

Similar proposals are pending in and .

Meanwhile, Florida has embraced the use of noncompete agreements, enacting the , which expands the scope of enforceable noncompetes, including for out-of-state companies with employees in Florida.

The new law takes the state in the opposite direction of California, Minnesota, North Dakota and Oklahoma, which prohibit noncompetes, in New York, Ohio, Texas, Virginia, Washington and Wyoming.

As of July 1, the new law allows Florida-based companies to enter into noncompete agreements with employees and contractors of up to four years of duration. The Act also purports to apply outside of the state—as long as the agreement expressly states it is governed by Florida law and is with an employer whose principal place of business is in Florida, the noncompete is enforceable regardless of where an employee is located.

The CHOICE Act covers employees and independent contractors who earn a base salary (excluding bonuses and commissions) of at least twice the annual mean wage of the Florida county where the employer’s principal place of business is located or the Florida county where the employee resides, if their employer is outside of Florida. The law expressly excludes licensed health care providers.

Under the law, employers must provide employees with written notice of their right to counsel and a seven-day review period before execution of the noncompete; employees must also confirm in writing that they will receive confidential information or engage in customer relationships during their employment.

Employers also have the advantage in enforcement.  If an employer seeks to enforce a noncompete, a court must issue a preliminary injunction preventing the employee from working for any competitor during the noncompete period, as well as a preliminary injunction against any competitor that hires a covered employee or contractor in violation of their agreement.  The court can modify or dissolve the injunction only if the employee proves, by clear and convincing evidence, that the noncompete is not enforceable or that the employee is not violating it.  

The law also contain similar provisions regarding garden leave agreements, where an employee promises not to compete with a former employer and sit on the sidelines while remaining on the payroll for a defined period.

Finally, employers in New York City face a new requirement: paid prenatal leave under the .  Effective July 2, 2025, this law incorporates the existing state requirement that has been in effect since January 2025 for private employers to provide employees with 20 hours of paid prenatal leave per 52-week period. The law applies to New York City employers of any size, even those with just one employee in the City. 

The leave is in addition to any paid sick and safe leave to which an employee is entitled and can be used in hourly increments for physical examinations; medical procedures; monitoring and testing; discussions with a health care provider related to the pregnancy, fertility treatments; and end-of-pregnancy care.

On top of the state requirements, New York City employers must also inform the employee of their available paid prenatal leave balance. Each pay period in which an employee uses the leave, the employer must inform the employee in their pay stub or other writing of the amount of prenatal leave used during the relevant pay period and the total remaining balance of prenatal leave.

The NYC law provides some protections for employers. If an employee has been absent more than three consecutive workdays, an employer is permitted to request documentation supporting the use of prenatal leave and employers may require an employee to provide reasonable notice of the need to use prenatal leave for “foreseeable” absences.

Possible penalties for violation of the law include payment of any wages owed, plus interest from the date of underpayment to the date of payment, with the possibility of liquidated damages up to 100 percent of the total wages unless the employer can demonstrate a good faith belief that their payment practices complied with the law.

Employees subject to retaliation for using paid prenatal leave may be entitled to injunctive relief, liquidated damages, reinstatement to their former (or equivalent) position and compensation for lost wages.

Civil penalties may also apply for violations of the law: for retaliation, payment ranging from $1,000 to $10,000; for underpayment of wages, a $500 penalty per violation.

Why it matters: Multi-state employers must always be aware of the various state- and even city-specific laws that may affect their operations.  The California and other state-proposed NLRB “trigger” laws would fill in the gaps in labor-law enforcement that has long been the exclusive purview of federal law.  Florida employers and businesses with employees in the state should review their noncompete agreements and consider updating them to take advantage of the CHOICE Act’s substantial benefits. Finally, employers in New York City should familiarize themselves and comply with the requirements for paid prenatal leave, which impose some additional obligations than the state law.