Labor: fair employment practices; certain noncompete agreements; prohibit employers from requiring employees to enter into unless certain conditions are met. Amends sec. 4a of 1984 PA 274 (MCL 445.774a).

HB 4040 bans most noncompete agreements between employers and workers in Michigan, directly affecting employees, contractors, interns, and volunteers. It prohibits employers from entering into, obtaining, enforcing, or even claiming that noncompete agreements apply to workers, except for two specific cases: (1) business owners selling their business, or (2) high-earning workers (over 200% of the federal poverty line for a family of three) with agreements limited to one year. The bill voids illegal agreements and allows workers to sue for damages, including lost wages and legal costs, if employers try to enforce prohibited terms. It specifically preserves agreements protecting trade secrets or restricting solicitation for qualifying high-earning workers.