Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Labor and Public Employment and Economic Development and Business Concerns, to which was referred H.B. No. 2641 entitled:

beg leave to report as follows:

The purpose of this bill is to void restrictive covenants or agreements between employees and employers in cases where the employee is or will be engaged in or employed by a technology business.

The Coalition for the Right to Innovate, NOVASOL, and a concerned citizen testified in support of this measure.

Non-compete agreements are contracts between an employer and an employee that prevent an employee from leaving the employer to either start or join a business that the employer considers to be competition. Currently, these agreements can and are being used in Hawaii. This has posed a problem for people in the technology business in Hawaii since there is only a small number of high technology companies in existence in the State. Moreover, employees affected by these agreements find that they are prevented from earning a living and oftentimes must move out of the State to continue to work in their profession.

As affirmed by the records of votes of the members of your Committees on Labor and Public Employment and Economic Development and Business Concerns that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2641 and recommend that it pass Second Reading and be referred to the Committee on Consumer Protection and Commerce.