The Dish | January

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Benefiting the NHLRA 4PM 6PMNASHUA BOSTON BILLIARD CLUB&CASINO www.nhlra.com │ 2
Inside 5 14 9 8 12 Members Around Town Empowerment Through Connections Upcoming Events Safety: Fire Extinguisher Quick Check Tips for a Compliant (& Safe!) Joint Loss Committee What's everyone up to? Schedule Sneak Peek Notable Dates Make sure your fire extinguisher is ready to go in case of an emergency Basic tips to know 15 New Hampshire Hospitality Month How can you get involved 17 Frosty Goggles Jambalaya Recipe From Woodstock Inn Brewery 26 How You Can Use Online Reviews to Drive Profits and Efficiencies in Your Restaurant By SpotOn www.nhlra.com │ 2 20 NHLRA Member Q&A By Samantha Poole 23 Owl's Nest Welcomes Chef Morgana Vesey Get to know the newest addition 28 Federal Trade Commission Proposes Rule Banning All Non-Competes From Vrountas, Ayer, & Chandler, P.C.
Chair of the Board
Rice-Norby
Inn Station & Brewery
Vice Chair of Lodging
Ferguson
Hill Distillery & Winery
Vice Chair of Restaurants
Barreira
NH Restaurants 2023 Vice Chair Allied Membership Paul Ramsey The Palace Theatre Secretary/Treasurer Bernie Lontine 110 Grill NHLRA President & CEO Mike Somers NHLRA Education Foundation Executive Director Amie Pariseau NHLRA Membership & Business Development Director Samantha Poole NHLRA Office & Events Manager AubreyLynn Goodale NHLRA Social Media & Marketing Coordinator Jillya Jannetti If you'd like to update us with any company news for our Members Around Town section, please email Jillya at jjannetti@nhlra.com. Want in on The Dish? It'sthattimeof year!Legislative updatescoming soontoyourinbox! www.nhlra.com │ 3
2023
Molly
Woodstock
2023
Brian
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2023
Nicole
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m │ 4 06 NOV MON 2023 BeanBags, Brews, &BBQ SMUTTYNOSE HAMPTON, NH SAVE THE DATE MONDAY, JUNE 5, 2023 JOINUSFOR: -GAMES -PRIZES -FOOD -DRINKS -MUSIC &MORE! GRAPPONE CONFERENCE CENTER CONCORD, NH

Members Around Town

Throwback

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Frogg

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The Crown Tavern celebrates Dry January with their own mocktail recipe. Brewing hosts 5th annual WinterCornholeTournament. new book by Mike Morin celebrating RedArrowDiner's100yearsofhistory. photo of Bratskellar DinnerhorninPortsmouth,NH.
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Register www.nhlra.com │ 7

Empowerment Through Connections

Schedule Sneak Peek

We’re excited to host Empowerment Through Connections for a second year, designed to celebrate women in the hospitality and tourism industry, provide an opportunity to connect withanddeveloppeerrelationships,andtoaddressyourtop-of-mindtopicswithagroupof industryprofessionals.We’rehardatworktocreateavaluableandinspiringagenda.

GUESTSPEAKER,DEBRASCHULER

Our morning will start with continental breakfast and our guest speaker, Debra Schuler. Her session,"PuttingThingsFirst,"willprovidepracticalstrategiesandtoolstohelpincreasefocus onyourmostimportantprioritiesandreduceand/oreliminatetheunimportant.

Living a more productive and balanced life starts with recognizing and accepting that not doingeverythingthatcomesacrossyourpathisnotonlyacceptable,it’swise.Highlyeffective people know that sometimes choosing to say “no” or “not now” to certain personal and professionaldemandsisnecessaryinordertofocusontheirhighestprioritiesandgoals.

APRESENTATION&PANELHOSTEDBYTHENHCENTEROFNONPROFITS

Afterlunchbythelake,we'llreturnwithapresentationandpanelhostedbytheNHCenterof Nonprofits."GetOnBoard"willinspireanewgroupofleaderstoconsiderboardserviceatlocal nonprofits.ThissessionwillconcludewithapanelofcurrentNHLRA,NHLRAEF,andcommunity board members as well as highlighting how you can become directly involved with the next generationoftheindustrythroughboardwork.

INTERACTIVESESSIONWITHDUPREYHOSPITALITY'SSHERRIFERNS

The afternoon will conclude with NHLRA Board Member and Regional Director of Sales and Marketing for Duprey Hospitality, Sherri Ferns. You’ll leave Sherri’s interactive session with ideasonhowtobringeverythingthroughoutthedaytogether.

NETWORKING&CHEERSTOTHEDAY

Towrapup,foranyonewhowouldliketonetworkorclinkglassestocheeragoodday,wewill gatherupstairsatLakesideGrill.

PLEASE CONTACT AMIE PARISEAU AT APARISEAU@NHLRA.COM WITH QUESTIONS OR TO INQUIREABOUTSPONSORSHIP.

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REGISTER W O M E N I N H O S P I T A L I T Y & T O U R I S M
MAY 23 | 8AM - 5PM | CHURCH LANDING, MEREDITH

Upcoming Events

Charitable Gaming Week

January 30 - February 5

Boston Billiard Club & Casino, Nashua

Venetian Ice Bar

February 2 - February 4, 6 p.m. - 10 p.m. Bedford Village Inn, Bedford

Valentine's Dinner featuring award winning Chef Michael Arrastia, jazz musician Eric Lindberg, and local craft distiller Bully Boy Distillers

February 11, 6 p.m. The Westbrook Inn, Derry

Fundamentals of Hospitality Management: Fundamentals of Management and Leadership (Class 1 of 3)

March 7, 9 a.m. - 3 p.m. Granite State College, Concord

Fundamentals of Hospitality Management: Effective Communication (Class 2 of 3)

March 21, 9 a.m. - 3 p.m. Granite State College, Concord

Fundamentals of Hospitality Management- Confidently Handle Conflict (Class 3 of 3)

April 4, 9 a.m. - 3 p.m. Granite State College, Concord

Women in Hospitality: Empowerment Through Connections

May 23, 8 a.m. - 5 p.m. Church Landing, Meredith

The 2022 FDA Food Code and You Webinar

January 25, 2 p.m. Online, learn more, and register here

January 23- North Conway January 23- Portsmouth February 1- Concord February 6- Manchester

February 14- Nashua

February 21- Portsmouth March 1- Concord March 7- Manchester

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ServSafe®
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Full-page advertisement in the event program

Five complementary event tickets - to be used by your company or by a current employeeorstudentoftheindustry

Full-page advertisement in the event program

Sevencomplementaryeventtickets-tobe used by your company or by a current employeeorstudentoftheindustry

Full-page advertisement in the event program

Ten complementary event tickets - to be used by your company or by a current employeeorstudentoftheindustry

Ten complementary event tickets - to be used by your company or by a current employeeorstudentoftheindustry

www.nhlra.com │ 11 W O M E N I N H O S P I T A L I T Y & T O U R I S M
Through Connections MAY 23 | 8AM - 5PM | CHURCH LANDING, MEREDITH Sponsorship Opportunities Your logo on all printed and digital materials including prominent signage throughout the event
channels ALLSPONSORSHIPLEVELSRECEIVETHEFOLLOWING PLEASE CONTACT AMIE PARISEAU AT APARISEAU@NHLRA.COM OR (603) 2289585WITHQUESTIONSORTOPARTICIPATE.
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one employee or student
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page advertisement
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your
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employeeorstudentoftheindustry ADVOCATE|$250 UNLIMITEDAVAILABLE MENTOR|$500 UNLIMITEDAVAILABLE LEAD|$750 FIVESPONSORSHIPSAVAILABLE INSPIRE|$1,000 FOURSPONSORSHIPSAVAILABLE
Empowerment
RecognitionintheMayeditionof"TheDish,"ourmonthlydigitalmagazine,andoursocialmedia
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in the event program 1/2 page advertisement in the event program Two complementary event tickets - to be used by
company
by a current employeeorstudentoftheindustry 1/2
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company
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15minuteSpeakerSpotlight Full-page advertisement in the event program
ACHIEVE|$1,500 THREESPONSORSHIPSAVAILABLE NETWORK|$2,000 THREESPONSORSHIPSAVAILABLE EMPOWER|$2,500 TWOSPONSORSHIPSAVAILABLE MOTIVATE|$5,000 TWOSPONSORSHIPSAVAILABLE
secondannualWomeninHospitality&Tourism.EmpowermentThroughConnectionswillbeaday tocelebrateallwomeninourindustry,createanatmospheretodeveloppeernetworks,andoffer
TheNewHampshireLodging&RestaurantAssociationEducationFoundationispleasedtohostour
sessionsonavarietyoftop-of-mindtopics.

Safety: Fire Extinguisher Quick Check

Quick checks of your business's fire extinguishers should be done monthly to ensure that they are ready-to-go when needed. Monthly "quick checks" should beconductedonthefireextinguishers,andmanagersormembersofthesafety committee should be instructed on how to properly conduct these “quick checks."A"quickcheck"shouldinclude:

Make certain that the extinguisher is mounted in its designated location, is unobstructed,andisavailableforimmediateuse.

Make certain that the nozzle, hose, extinguisher body, discharge apparatus, andmountingbracketareundamagedandinserviceablecondition.

Checkthattheextinguisherisfullycharged.

Checkthatthesafetypinisinplaceandhasawiresecuritytieholdingit.

Initial and date the backside of the tag provided by the service company, whichconductstheannualinspectionoftheextinguishers.

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Tips for a Compliant (& Safe!) Joint Loss Committee

What are the requirements of a 'Safety Committee’? A safety committee, also referred to as a Joint Loss Committee, must meet quarterly to review injuries, safety concerns, and finding solutions. The committee needs to meet quarterly, have equal parts management and non-management level staff, document meetingminutes,andmakethoseminutesavailabletoallstafftoreview.

What is the point of a Safety Committee/ Joint Loss Committee? This committee is to review your safety policies, potential hazards, and employee concernsregardingsafety.

BASICSTOKNOW:

If you have, at any time of the year, 15 or more employees, you need to set upaSafetyCommitteeanddevelopawrittensafetyprogram.

It needs to have at least four members, and at least half of the members havetobenon-managerstaff.

It needs to meet at least four times per year (quarterly), and the meeting minutes need to be posted in an area that employees easily see or have accessto.

Have a staff meeting to establish your committee, or have the meeting be doneviaalongpre-or-post-shifttodevelopyourcommittee.

Postyourminutesinanystaffareawhereyounormallykeepyourlaborand anyotherrequiredposters.

Offer a suggestions box for safety concerns. This will streamline the process ofidentifyingconcernstodiscussduringthesafetymeetings.

Make sure that you keep the committee 50/50 or more employees than managers.Thatisthebiggestconcern(andcauseforviolation)iftheDOLis reviewingyourcommittee.

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TIPSONSTARTINGACOMMITTEE: RESOURCESFORYOURCOMMITTEE:
CH.600:LegislativeText NHDOL:MeetingMinutesExample&Resource NHDOLSafetyProgramGuidance
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2CansFrostyGogglesRedPaleAle 1lb.peeledshrimp 12oz.AndouilleSausage,slicedintorounds 1lb.boneless,skinlesschickenbreasts,cutin1-inchcubes 1onion,diced 1yellowpepper,seeded&diced 1redpepper,seeded&diced 2stalkscelery,chopped 4clovesgarlic,minced 14oz.cancrushedtomatoes 1canfireroasteddicedtomatoes 1tsp.salt 1/2tsp.blackpepper 1tsp.driedthyme 1tsp.driedoregano 1/2tsp.redpepperflake 1/4tsp.cayennepepper 1/2tsp.hotsauce 2tsp.Worcestershiresauce 1canOkraor1cupthinlyslicedokra 2cupschickenbroth This Jambalaya is jazzed up with Frosty Goggles, which we consider to be the bestwinteraleintheNortheast.Thissouthernrecipewillwarmyoursoulduring thewintermonths!TryourFrostytakeona“BigEasy”classicrecipe. INGREDIENTS DIRECTIONS Step1:CookAndouillesausageinaDutchovenorsouppotuntilbrowned. Step2:Deglazewith1/2canFrostyGoggles.Removesausageonceallliquidis reduced. Continues... Frosty Goggles Jambalaya Recipe By Woodstock Inn Brewery www.nhlra.com │ 17

Step 3: Add chicken into pot with sausage drippings; cook until browned, then deglazewith½canFrostyGoggles.Removechickenonceliquidisfullyreduced.

Step 4: Add all veggies and cook until soft, then once again deglaze with ½ can FrostyGogglesandreducebyhalf.

Step 5: Add all tomatoes, 2 cups chicken broth, all protein, and top off with 1/2 cupFrostyGoggles.

Step6:IfusingDutchoven,placeintheovenat400°for35-45minutes.Ifusing a soup pot, bring to boil then reduce heat and simmer uncovered for 30 minutes.

Step 7: Add shrimp during the last 5 minutes of cooking time; garnish with choppedchivesorslicedscallionsandenjoy!

FrostyGogglesisavailableattheWoodstockInnBrewery.

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Take the One-Hour Challenge!

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Member Q&A

CANHOTELSCHARGEACLEANINGFEEFORSERVICEANIMALS?

No. Hotels are not permitted to charge guests for cleaning the hair or dander shedbyaserviceanimal.However,ifaguest’sserviceanimalcausesdamages to a guest room, a hotel is permitted to charge the same fee for damages as chargedtootherguests.

CANIRECORDAUDIOCONVERSATIONSINTHEBREAKROOM?

Not without prior consent. New Hampshire state law stipulates that it is a twoparty consent state, meaning that in New Hampshire it is a criminal offense to use any device to record communications, whether they're wire, oral, or electronic, without the consent of everyone taking part in the conversation. Recording conversations, regardless of whether it is within your organization or viatelephone,isillegalandinmanycasesafelonyoffense.

Link: 570-A:2 Interception and Disclosure of Telecommunication or Oral CommunicationsProhibited

WHATISTHENHPAIDFAMILY&MEDICALLEAVE(NHPFML)INSURANCEPLAN?

NH PFML is a state-sponsored voluntary plan where NH employers and eligible NH workers can purchase PFML Insurance providing 60% wage replacement, up to the Social Security wage cap, for up to six weeks per year for absences from workforcoveredcommonlifeevents.

Link:NHPaidFamily&MedicalLeave

WHATISASAFETYSUMMARY?

A Safety Summary form only needs to be filled out and submitted to the DOL once.Althoughtheydostatethatthesafetypolicymustbereviewedeverytwo years. All private employers who have 15 or more employees are required to furnishaSafetySummarytotheDOLaswellashaveaSafetyCommittee/Joint LossCommittee.

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ARETHEIRLAWSREGARDINGHOWMUCHTIMECANBESPENTDOINGSIDEWORK?

Yes.USDepartmentofLabor’s“FinalDualJobsRule''setslimitsontheamountof time an employer can take a tip credit when a tipped worker isn't doing tipproducing work. The change states that an employer may take a tip credit, which allows the employer to pay a tipped employee below federal or state minimum wage, only when an employee is performing work that is part of a tippedoccupation.Specifically,thisfinalrulemeans:

Tipped employees can only perform work that directly supports tipproducing work for less than 20 percent of the hours worked during the employee’s workweek. Any of the time that exceeds 20 percent of the workweekmustbepaidatminimumwageorabove

AND

A tipped employee can only perform directly supporting work for no more than 30 minutes. This means that the employer cannot take a tip credit for anyofthetimethatexceeds30minutespershift

Link:U.S.DOLPressReleaseonNewRule

CAN EMPLOYEES BE DISCHARGED FOR DISCLOSING OR DISCUSSING WAGE BETWEENEMPLOYEES?

No employer can discharge or in any manner discriminate against any employee because they inquired about, discussed, or disclosed their wages. Employees may also disclose the wage of another employee if the employee has access to the wage information as a part of such employee's essential job function and is disclosing to another employee who does not otherwise have access to such information. There is an exception if this disclosure is in response to a complaint, investigation, or hearing, including an investigation conductedbytheemployer.

CANGIFTCARDSEXPIRE?

Anygiftcertificateunder$250cannotexpire.Ifacustomercomesinwitha$25 gift card they had stashed from a decade ago, unless they are covered by the exclusionsbelow,theyhavetobehonored.Giftcertificatesover$250canexpire if the certificate goes unused for more than five years. In this situation, the business is required to turn that money over to the State as "abandoned property."Therearesomeexclusions.Thislawdoesnotapplytoseasonpasses or non-refundable coupons. It also excludes gift cards that were given by a businessforpromotionalpurposesordidnotrequirepaymenttoreceive.

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WHAT IS THE ELIGIBILITY FOR THE LOCAL RESTAURANT INFRASTRUCTURE INVESTMENTPROGRAM?

This program is open to New Hampshire-based restaurants and is intended to aidprimarilyfull-service,eat-in,non-franchisesmallrestaurants.Tobeeligible, anapplicantmustmeetthefollowingcriteria:

HavebeenoperatingpriortoMarch20,2020; Be actively paying Meals & Rooms taxes to the State as a food service establishment; Have annual gross receipts, including all affiliates, at or below $20,000,000, in tax year 2021 or not exceed annual gross receipts per New Hampshire locationof$5,000,000; BesubmittingexpensesforonlyNewHampshirelocations;and Not be a national chain (locations in three or more states), a national franchise (locations in three or more states), delivery or take out only, or primarilycatering.

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Owl's Nest Welcomes Chef Morgana Vesey

It’s official, the White Mountains just got tastier. Join us as we welcome our newest addition to the Owl’s Nest team, Chef Morgana Vesey!

Hailing from New London, Connecticut, Morgana brings along a strong work ethic, passion for delicious, locally crafted food, and some signature dishes that even world-renowned chef Gordon Ramsay can confirm are exceptional.

For those who are dedicated foodies and keep up on reality cooking shows, you may recognize Morgana from Season 20 of Hell’s Kitchen, featuringthe“youngguns.”At21yearsold,

Morgana made her mark on the show as one of the youngest contestants in its history by delivering some exquisite dishes such as her signature pan-seared duckbreastservedwithBrusselssproutsandprosciutto.

Before her experience on Hell’s Kitchen, Morgana embarked on her culinary career at age 16 as a line cook. She quickly rose to the challenge in the fastpaced and ever-changing kitchen environment and before long, Morgana was running the kitchen herself. Despite experiencing the difficulties of being a woman in a generally male-dominated industry, she stood fast in her belief that her food matters and that she can lead a kitchen just as well as anyone else.

Through her early experiences in the restaurant industry, Morgana’s fortitude, work ethic, and apt culinary skills helped her build the foundation needed to exploreotherculinaryendeavors.In2018,MorganaearnedtheroleasSousChef at the Norwich, CT-based Canggio Restaurant & Bar. Morgana’s position providedauniqueopportunitytoexperimentwithhercreativesidebyplayinga highlyinfluentialroleinthedevelopmentoftwonewseasonalmenus.

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While working at Canggio, Morgana worked to fulfill a career-long dream of opening her own restaurant. After about one year with Canggio, Morgana openedupherownbar,86’d,alongwiththehelpoftwootherbusinesspartners. 86’d Bar offers Morgana’s touch on classic pub food. The menu items are simplistic yet deliciously executed with fresh ingredients. 86’d Bar saw success earlyonandquicklybecameapopularlocaleaterywithintheNorwich,CTarea. Following her time at Canggio, Morgana undertook the position of Executive Chef at the locally known seafood restaurant, Water Street Café in Stonington Borough, CT. Water Street Café specializes in preparing and serving dishes with thefreshestseafoodandmostlocalingredientspossible.Throughtheguidance ofchefandowner,WalterHoulihan,Morganahadtheopportunitytocreateand execute weekly menus, helping progress her unique and inventive style of cooking. With immediate access to freshly caught seafood, locally sourced produce, and a changing weekly menu, Morgana referred to the experience as “achef’sdream”andcontinuedtobuilduponherstrongculinaryskillset.

Moving forward from her positions at Canggio, Water Street Café, and appearanceonHell’sKitchen,Morganahasnowjoinedourculinaryteamasthe Chef of Panorama Six82 alongside Executive Chef Matt MacDonald. Morgana bringshervibrantenergyandhighlevelofcreativitytothekitchenhereandour menu reflects it! From appetizers and sandwiches to entrees and desserts, Morgana has made her culinary touch known within our community and the feedbackhasbeenremarkable.

Morgana’s signature duck breast dish is among one of our favorites here at Panorama Six82 and has been a crowd favorite since the new menu unveiling. We eagerly await what the future holds with Morgana and Matt’s expertise at the helm of our culinary team here at Owl’s Nest! Next time you ’ re in the southernWhiteMountains,besuretogivePanoramaSix82atryandexperience firsthandthewonderfulcreationsChefMorganahasinstore.

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www.nhlra.com │ 25 MARCH20,2023 DOUBLETREEBYHILTONMANCHESTERDOWNTOWNHOTEL APPLYBYFEBRUARY1FORACHANCETOBEACHEFCOMPETITORAT OUR7THANNUALSTEELCHEFCHALLENGE,PRESENTEDBYSERVICE CREDIT UNION. THIS YEAR’S COMPETITION WILL BE HOSTED BY TV HOST,CHEF,WRITERANDSOCIALADVOCATE,ANDREWZIMMERN! PROFESSIONALCHEFS Calling All New Hampshire APPLYNOW NOTAPROFESSIONALCHEF? You Can Still Get Involved! THE NH FOOD BANK IS LOOKING FOR VOLUNTEERS! NO MATTER YOUR AREA OF EXPERTISE, THERE'S AN OPPORTUNITY FOR YOU! CLICKONANOPPORTUNITYBELOWTOSIGNUP! EVENTSETUP KITCHENSUPPORT EVENTSUPPORT SERVERS EVENTBREAKDOWN INTERESTEDINLEARNINGABOUTSPONSORSHIPOPPORTUNITIES? CONTACTNANCYAT(603)669-9725ORNMELLITT@NHFOODBANK.ORG.

How You Can Use Online Reviews to Drive Profits and Efficiencies in

Review management is using customer feedback to identify trends and make improvements in your business. It’s having business profiles on popular review siteslikeYelp,Facebook,Google,andTripAdvisor,thatyouupdate,monitor,and respondto.It’sanunlikely,butextremelypowerfultool.

MASTERREVIEWMANAGEMENTIN5STEPS

Makesureyourbusinessisequippedtomanagereviewsandidentifytrendsby doingthefollowing:

STEP1:CLAIMYOURBUSINESSPROFILESONREVIEWSITES

Have you claimed your pages on the following review sites? Write down your credentialssomewhereeasilyaccessiblesoyoucanquicklyandeasilyloginto respondtoreviews.

STEP2:CONNECTYOURPROFILESTOYOURSPOTONDASHBOARD

Areallofyourprofilesconnectedtothereviewmanagementsoftware built into your SpotOn account? Make sure you ’ re viewing all of your online feedback in oneplacetosavetimeandgetnewreviewalerts.

If you ’ re already a SpotOn client, simply log into your SpotOn Dashboard, andchooseReviewsfromthemainmenu.

Ifyouaren’tyetusingSpotOn,clickhere to talk to our restaurant technology expertsandgetapersonalizeddemonstration.

Pro tip: Be sure to enable notifications so you are notified when a new one comesin.

GoogleBusinessProfile Yelp TripAdvisor Facebook
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clickhere

STEP3:MONITORANDRESPONDTOREVIEWS

Howoftendoyouplantomonitorandrespondtoreviews?Makesureyouhave a consistent cadence and dedicated person to respond to your reviews, and makesuretheyaretrainedtorespondtonegativefeedbackappropriately.

STEP4:TRACKTRENDSANDMAKECHANGES

Keep track of guest feedback—good and bad—while monitoring your reviews. If a menu item, staff member’s name, or anything else about the guest experience shows up more than once, be sure to address it. If it’s positive feedback, reward the staff who made it happen. If it’s negative feedback, determine how to improve operations to eliminate the problem. Be on the lookoutforfeedbackabout:

STEP5:DOWNLOADOURFULLPLAYBOOKANDMAKETHEMOSTOFYOURREVIEWS

Seehowsimpleitistouseonlinereviewstocatchwindofoperationalissuesat yourrestaurant—andfixthembeforetheybecomeaseriousproblem.

Daily Onceaweek Onceamonth Never
Astheycomein
Staffperformance Atmosphere/ambiance Overallservice(e.g.waittime,pricing,checkout)
Qualityoffood&beverages
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GetMyCopy(Link).
WEEK Charitable Gaming JANUARY30-FEBRUARY5 Benefiting the NHLRA TRYYOURHANDATSLOTS, ROULETTE,POKER,&MORE! Join us at Boston Billiard Club & Casino, Nashua! A percentage of proceeds will benefit the Education Foundation,helpingtofinanciallysupporthospitalityrelated initiatives and enhance the industry’s service tothepublicthrougheducation,promotionofcareer opportunities,andcommunityengagement! www.nhlra.com │ 28

Federal Trade Commission Proposes Rule Banning All NonCompetes

Major change may be coming to companies who need to protect their trade secrets or good will from departing employees. On January 5, 2023, the Federal Trade Commission (FTC) announced its notice of a proposed rule that would prohibit businesses from using these covenants with their workers. While some states like California have already banned such provisions, most allow them undercertaincircumstances.Theproposedfederalizationofthelawinthisarea could mean substantial change for those businesses who seek to protect their intellectualpropertyfromwalkingoutthedoor.

Thecovenantnottocompeteisoneofmanylegaltoolsbusinessesmayuseto protect their intellectual property from the departing employee who may seek to compete unfairly against their former employer. Other legal protections include the laws banning the theft of trade secrets, laws imposing a duty of loyalty on current employees, and laws imposing a fiduciary duty on some employeesholdingcertainpositionswiththeiremployers.Theselawsgoverning employee behavior, along with the laws protecting copyrights, trademarks and patents, provide the essential tool kit for companies to protect their intellectual propertyfromunfaircompetition.

The covenant not to compete differs from the other tools because it is solely a creatureofcontract.Whiletheotherlawsprovidetheirprotectionsasageneral matter, a departing employee is presumed free to compete fully against their former employer without restriction. This is because none of the other laws protect customer goodwill and relationships as an asset. Unless the employer ensures that its employees execute a contract that expressly prevents the employee from taking the employer’s customer relationships and goodwill, those relationships, and the business stream associated with them, can too easilywalkoutthedoorwiththedepartingemployee.

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Thus, the covenant not to compete has become an important device for companies to protect an asset that is otherwise unprotected under law. Such covenants come in various forms. Typically, the provision restricts a departing employee from engaging in competing activity for a period of time. In most states,theseprovisionsmustbereasonableintimeandgeographicscope,and must be narrowly tailored to protect legitimate business interests, which have generallybeendefinedasthecompany’sgoodwill,customerrelationships,and tradesecrets.

The FTC’s proposed rule would, among other things, ban covenants not to compete in the employment context as an unlawful restraint of trade under federal anti-trust law. Not only would the proposed rule ban use of these covenants, it would require employers to rescind existing non- compete agreements and inform individuals subject to such agreements that the restrictivecovenantsagainstcompetitionarenolongerineffect. The proposed rule would cover both employees and independent contractors. They would be banned in all employment agreements and employee severance agreements. Theproposedrulewouldnotpreventapersonsellingabusiness,orafranchisor and franchisee, from agreeing to or entering into an agreement with a noncompete.

While this may sound radical, the proposed ban would still allow for other contractualprovisionsthatmaybeequallyeffectiveinprotectingagainstunfair competition.Theproposedruleprobablywouldnotbancovenantsnottosolicit specific customers, or covenants not to solicit company employees. The proposed rule would also allow confidentiality and non-disclosure agreements, which essentially serve as contractual agreements to comply with trade secret protections. The FTC Fact Sheet specifically states that employers will continue to have other ways to trade secrets, confidential business information or valuable good will. Thus, the proposed rule targets the most restrictive form of the covenant not to compete, specifically banning any “contractual term between an employer and a worker that prevents the worker from seeking or accepting employment with a person, or operating a business, after the conclusion of the workers’ employment with the employer.” The proposed rule labelssuchtermsas“non-compete”provisions.

But companies should not rush to complacency by the apparent limited scope oftheproposedban.Callingaterma“Non-Solicit”or“Non-Disclosure”provision willnotsaveitifinallpracticalityitservesasafullon“non-compete”provision.

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The proposed rule notes that the function of the provision, and not how it is labeled, will determine if the provision is subject to the ban. Thus, if a provision that merely prohibits a worker for soliciting clients or employees has the effect of preventing a worker from seeking or accepting employment, it is possible thateventhoseprovisionscouldviolatetheproposedrule.

So, what does this mean for business who use non-competes? Well, do not tear up your non-compete agreements just yet. Many expect a robust legal challenge to the proposed rule on the basis that it goes beyond the FTC’s rule making authority. While we wait to see what happens with any such challenge, businesseswithaninterestontheissuecansubmitcomments,pro-orcon-by March10,2023.Commentscanbesubmittedhereonline.

In the meantime, businesses must continue to comply with the limitations on non-compete clauses set by the states in which they do business. California has, for example, long ago banned such provisions but has been very willing to enforce non-disclosure provisions and trade secret laws. New Hampshire, for example, prohibits the use of non-competes with low wage earners and requires employers to provide a copy of any noncompete agreement to any potential employee prior to the employee’s acceptance of an offer of employment.InMassachusetts,noncompetitionagreementsmustmeetcertain minimum,andspecificstatutoryrequirementsinordertobevalid.Amongother things, they must be in writing and signed by employee and employer. They must expressly state that the employee has the right to consult with counsel prior to signing. They must also be specifically supported by fair and reasonable consideration independent from the continuation of employment, and such consideration should amount to at least 50% of the employee’s base salaryofthedurationofthenon-competeorsomethingcomparable.

These are just some of the various state requirements that must be followed and there are many others as the movement to regulate covenants not to compete has been developing across the country for years. Businesses should be mindful of these rules, continue to monitor developments in the law, and seek legal counsel when necessary to understand and comply with limitations applicabletothemandtheirworkforce.

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YOUR HELP! THE EDUCATION FOUNDATION TO DONATE OR FOR MORE INFORMATION, KINDLY REACH OUT TO:
at
working to turn the best and
talent
industry
please
give
students
your
and donate prizes for theFoundationtoawardthroughouttheyear. Yourdonationwillhelpinspirethenextgenerationof chefs,businessowners,andmanagerstofollowtheir hospitalitydreams! www.nhlra.com │ 34
NEEDS
Amie
apariseau@nhlra.com. From ProStart® to career fairs to New Hampshire HospitalityMonth,theNHLRAEducationFoundationis always
brightest
intotomorrow’sindustryleaders. Here at NHLRA, we know that no one knows the
quite like you do;
help
these
a taste of
world
HAVEA QUESTIONOR CONCERN? MembershipintheNHLRA meansbeingapartoftheonly organizationinthestate dedicatedtoprotecting, promoting,andeducatingour hospitalityindustry. Contactusforquestionsorto sharewhatissuesareaffecting yourbusiness.We'reherefor you. GOVERNMENTAFFAIRS: MikeSomers msomers@nhlra.com EDUCATIONANDWORKFORCE DEVELOPMENT: AmiePariseau apariseau@nhlra.com MEMBERSHIPANDBUSINESS DEVELOPMENT: SamanthaPoole spoole@nhlra.com OFFICEANDEVENTS: AubreyLynnGoodale agoodale@nhlra.com SOCIALMEDIAAND MARKETING: JillyaJannetti jjannetti@nhlra.com NHLRAOFFICE: (603)228-9585 info@nhlra.com Member Solutions MUSICLICENSING Memberssaveupto20%offmusiclicensingfeesfor BMIand10%offSESAC GROUPPURCHASINGORGANIZATION NHLRAmembersreceivecashbackonmanufacturer rebatesnormallyunavailable. COMPLIANCEPORTAL Includingriskmanagementandsafetytools,compliance support,andtemplatesfortrainingandsafetymanuals. 401(K)PROGRAM Establisha401(k)programwithminimaloverheadunder aNHLRAumbrellaplan. CREDITCARDPROCESSING Receiveadiscountofupto10%offofprocessingfees. LIQUORLIABILITYINSURANCE Saveupto20%offyourliquorliabilityinsurancepremium PROPERTYINSURANCE Youmaybeeligiblefora5%discountonproperty insurance MUSICLICENSING Membersreceiveanexclusive10%discountonthe subscriptionpriceanda30-dayfreetrial LEGALSERVICES 30minutesoffreelegaladviceperincident,issue,ormatter. Needtoretaintheirservices?Receiveadiscountedrate. WORKERS'COMPENSATIONTRUST Ourself-funded,not-for-profit,workers'compensationtrust returnsdividends(onaverage)of20-35% DENTAL&VISIONINSURANCE Saveupto15%ondentalandvisioninsurancerates throughourgroupbuyingprogram www.nhlra.com │ 35
www.nhlra.com │ 36
December Renewals & New Members Thank You & Welcome! 815 Cocktails & Provisions Celli's Pizza Clark's Trading Post Dennis Paper and Food Service Ecolab Favorite Foods, Inc. Flag Hill Winery, Distillery, Catering and Events Fratello's and Homestead Island Hospitality Management Liberty Lane Catering Maine Course Hospitality Group Makris Lobster & Steak House Mountain Edge Suites at Sunapee Naswa Resort New Woodshed Pizza Mia Purity Spring Resort The Wilder White Mountains Attractions Woodstock Inn Station & Brewery www.nhlra.com │ 37

16 Centre Street Concord, NH 03301 | (603) 228 - 9585 | nhlra.com

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