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Opinion >  Column

Eye on Boise: Idaho businesses want 2016 noncompete law repealed

The Idaho Legislature convenes on Jan. 9, 2017, at the Idaho state Capitol in Boise; when lawmakers reconvene for their 2018 session, Idaho business leaders want them to repeal a controversial 2016 law regarding non-compete agreements. (Otto Kitsinger / AP)
The Idaho Legislature convenes on Jan. 9, 2017, at the Idaho state Capitol in Boise; when lawmakers reconvene for their 2018 session, Idaho business leaders want them to repeal a controversial 2016 law regarding non-compete agreements. (Otto Kitsinger / AP)

More than 100 Idaho business leaders, ranging from high-tech CEOs to small-business owners to engineers, marketers and manufacturers, have signed a letter to Gov. Butch Otter and the Idaho Legislature calling for the repeal of a 2016 noncompete law that sharply limits the rights of employees who move to new firms.

The law, which passed both houses by divided votes amid much controversy, took effect July 1, 2016. Since then, Idaho has drawn a slew of negative national publicity over the law, from a New York Times headline that proclaimed “Noncompete Pacts, Under Siege, Find Haven in Idaho,” to an article headlined: “Have a great startup idea? Don’t move to Idaho.”

House Assistant Minority Leader Ilana Rubel, D-Boise, an attorney who vehemently opposed the bill, is leading the call for its repeal.

“As amended, the statute requires Idaho courts to find that employers who hold noncompete agreements suffer ‘irreparable harm’ when an employee takes a job with a competitor, regardless of whether any actual harm occurs,” Rubel said. “Any law that stifles business growth and encourages entrepreneurs to leave the state is not good for Idaho. It also hurts families because workers don’t have the freedom to find a better, high-paying job for fear of getting sued. No one should have to endure a lawsuit in order to start a business or take a better job. That’s simply anti-growth.”

The business leaders’ letter says: “We, the undersigned, represent a wide range of business interests in the great state of Idaho. We are extremely concerned about the growth of not only our own businesses, but of Idaho’s economy generally. We want to see Idaho take its place as a hub of technology and other knowledge-based industries, and we are concerned that Idaho’s laws are not currently fully supportive of that goal.”

Among those signing the letter were Ward and Joe Parkinson, the co-founders of Micron Technology; Jamie Cooper, CEO and president of Drake Cooper; Michelle Crosby, founder and CEO of Wevorce; Ken Edmunds, owner of the Edmunds Group and former state labor director; Milt Gillespie, president of Mariposa Labs; Todd Hunter, owner of Idaho Lumber; Bob Lokken, founder of WhiteCloud Analytics; Paul Price, CEO of Balihoo; Jeff Roth, owner of Hailey Dental Studio; and many more.

“We need a fair path for workers to leave a job and launch new businesses for Idaho’s economy to thrive,” the business leaders wrote in their letter. “We need investors to have confidence that they can invest in start-up companies without facing costly lawsuits in which the deck is stacked against them. The risk created by HB 487, when added to the usual uncertainties facing any new venture, makes investment in start-up companies in Idaho a much less attractive proposition.”

Jon Hanian, press secretary for Otter, said the governor hadn’t yet seen the letter. “Once we get it, we’ll review it and obviously we’ll read through it and see what they have to say and then go from there,” he said.

The 2016 bill was proposed by Rep. Patrick McDonald, R-Boise, and was supported by the Idaho Association of Commerce and Industry. It was also supported by Codi Galloway, owner of LeapFox Learning, who was embroiled in a pending lawsuit against a former employee who she said stole customer lists despite a noncompete agreement.

The bill squeaked through the Senate Commerce Committee by just one vote at the panel’s final meeting of the year, after lawyers on both sides argued vehemently for and against the bill and an Idaho attorney general’s opinion pointed out problems with how it was worded.

A lobbyist for Micron, Jayson Ronk, spoke briefly in support of the bill at the 2016 committee hearing, saying the company’s legal team had reviewed the bill and believed it would benefit employers, and that Micron signed few noncompete agreements.

Otter signed the bill into law without comment on March 30, 2016.

Idaho rep takes 2nd for ‘Lie of Year’

Politifact conducted a poll of its readers on the “2017 Lie of the Year,” and while President Donald Trump calling “the Russia thing” a “made-up story” took first place, it was Idaho’s own 1st District Rep. Raul Labrador who came in second, for saying, “Nobody dies because they don’t have access to health care.” Labrador’s comment at a Lewiston town hall last spring drew a national firestorm of criticism. He is running for governor of Idaho in 2018.

Politifact’s reader survey drew more than 5,000 responses. Coming in third: former presidential press secretary Sean Spicer’s claim that Trump had “the largest audience to witness an inauguration, period.”

The Pulitzer Prize-winning fact-checking website, famous for its “Truth-o-Meter” and “Pants on Fire” rating for the worst lies, rates the accuracy of claims by elected officials and others who speak up in U.S. politics. It is run by editors and reporters from the Tampa Bay Times, which is owned by the nonprofit Poynter Institute.

MTM to replace Veyo

The Idaho Department of Health and Welfare has chosen a new contractor to broker non-emergency transportation of Medicaid patients, to take over for Veyo in March: Medical Transportation Management Inc. The St. Louis, Missouri-based firm operates in 28 states; it was selected from among four bidders.

The $34 million contract with MTM will run through June of 2019, with an option to extend for up to an additional five years. Veyo was granted a $70 million, three-year contract with the state in 2016 but is ending it early this spring after much friction over the firm’s Uber-style business model, in which independent drivers, rather than traditional medical transportation providers, transported some patients.

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