The Issue: The American Federation of Radio and Television Artists (AFTRA) is continuing their nationwide legislative effort to remove broadcasters’ ability to incorporate non-compete clauses in personal service contracts. Once again, their cause has found a sympathetic sponsor in the Michigan legislature. House Bill 5750, sponsored by Representative Fred Miller (D-Mt. Clemens) and Senate Bill 1068, sponsored by Senator Ray Basham (D-Taylor) are identical bills that were introduced in January. The bills exclusively eliminate a broadcaster’s ability to negotiate non-compete clauses in personnel service contracts with on-air talent.
History: AFTRA had spearheaded a similar attempt during the final day of the lame duck session in 2008. Representative Andy Meisner (D-Royal Oak) authored HB 6695 of 2008 and immediately gave it a hearing, as chairman, in the House Commerce Committee. The MAB offered testimony in opposition to the bill and it ultimately was not brought to a vote.Since 1985, Michigan has had a strong statute on the books, strictly regulating the terms of non-compete clauses. State law not only requires the terms of the agreement to be reasonable, but also gives the courts discretion in amending the terms of the contract to make them reasonable.
Legislative Action: The bills were both introduced in January of 2010. House Bill 5750 had 18 co-sponsors, while Senate Bill 1068 had one. The MAB caught wind of the legislation prior to introduction and has worked withthe sponsor. Representative Miller since October 2009. The legislation was taken to committee but never passed. The MAB is working with House and Senate leadership to ensure no action is taken again this year.
Industry Views: The current statutory provisions provide a fair and equitable system for resolution for both the broadcast station and its employees. Government interference with the terms of private contract agreements has dangerous consequences, and its effects on Michigan’s broadcast industry would be devastating. Non-Compete clauses help protect a station’s substantial and unique investment in its employees. Earning a communy’s confidence does not happen by accident. Local broadcasters invest millions of dollars each year in branding and promoting on-air personalities in an effort to ensure the viewing public is familiar with those responsible for disseminating vital news and information in times of crisis.