Vermont Legislature SmartTranscripts:

[Marc Mihaly (Chair)]: Welcome everybody to the House Committee on General and Housing, and today is, and the behavior of everyone in this room indicates that today is Friday, April 17, all day. We've come off the floor and the committee is now convening. We're going to start with S230 again. S230 is, for those watching the tape, is basically a kind of compendium of labor issues that has come over from the Senate, and we have added many of our provisions to it as well. One of the provisions that we're discussing now is a non compete provision, and we had various people testify and provide some language. Our counsel has joined us, worked with that, and then we had some comment back and forth, and this is now our esteemed counsel has provided draft 6.1, of which she is about to go over. So take it away.

[Sophie Tidatney (Office of Legislative Counsel)]: Right. So good morning, Sophie Tidatney for the Office of Legislative Council. To just move swiftly to its sections

[Marc Mihaly (Chair)]: is on page four and five.

[Sophie Tidatney (Office of Legislative Counsel)]: Right, so this is the new section 3B, agreements not to compete. So one of the things that's new to this particular draft is just adding in some headings to section 3B to make it a little easier to understand what's going on. So A is dealing with agreements not to compete involving non exempt employees. And then subsection B, which is where the committee is focused right now, deals with health care providers. So this tweaks the language that the committee had looked at before. So in subdivisions one, before there are a list of criteria that you cannot have in a health care provider contract. And what was discussed yesterday was the way it previously read was that if any of those provisions were in a contract, then the whole contract would be void and unenforceable. So this version limits it that those particular provisions, if they're in a contract, would be void and unenforceable. So that's what the language that you're looking at right now. Any provision in a contract or agreement that creates or establishes the terms of partnership, employment, or any other form of professional relationship with a healthcare provider regarding healthcare providers' provision of healthcare services in Vermont shall be void and unenforceable if the provision and then it's going to go through the list. The pre gone.

[Marc Mihaly (Chair)]: I do want to point out to the committee and to others in the room, what I think is a significant change here to the better. It is, first of all, as Sophie has indicated, it now is referring to the provision in the contract, not the but whole it also, by adding healthcare providers, I think that's always been the intention here, to protect the healthcare provider, and that's a term of art, and it's a defined term, and we know what it is, and we want to protect them. By adding health the health care provider, and I think it makes that clear, we were a little there was some concern on the part of the committee. I know the vice chair expressed his concern that the way it was drafted, it almost read as if anyone who worked for a hospital, say, or anyone who worked in an institution that was providing health care, support staff, whomever, would be covered by this, and even contractors, and that it was too broad. We thought it was clear that the intention was to protect the healthcare provider, and I think this sentence now makes that clear. So thank you.

[Sophie Tidatney (Office of Legislative Counsel)]: And the heading, I think, well, just so that you don't speak it. All right, so again, these are the restrictions, things you cannot have in an agreement with a healthcare provider. So A is a restriction and instead of any restriction, it just says includes a restriction on the right to the healthcare provider to provide healthcare services in any geographical area for any period of time after the termination of such partnership agreement or professional relationship. So that's really a more traditional non compete kind of agreement. B, limits the ability of a separating health care provider to provide notice of the provider's change of employment to individuals to whom the separating provider provided direct health care services. And again, the notice requirements are in the next subdivision. C was a bigger change. So this was to state explicitly, you can't have a provision that restricts a health care provider from making disparaging statements about another party to the contract or agreement or about another person specified in the agreement as a third party beneficiary of the agreement. D is if it's inconsistent with Vermont law, and just remind you what before it said makes the agreement subject to the laws of another state, and again based on the conversation yesterday, the goal was that an agreement that's entered into can't be inconsistent with what the protections that would be provided by Vermont law. And then E requires litigation arising from the performance of the contract or agreement in Vermont to be conducted in another state. So in other words, it would be focused on litigation that involves conduct or the contract that happened here in Vermont rather than some other contractual issue that's not tied to Vermont? Go ahead, please. Is dean necessary? Because wouldn't any contract written that is inconsistent with Vermont law be void? Well, it depends on, again, what kinds of claims could come up. So for example, in Vermont, you couldn't terminate under employment law, you can't terminate someone if it's against public policy in Vermont. That's not necessarily true in other states. They may not have a public policy exception So around if someone were to be terminated and there's an argument, and I'm just making this up on smoke at the moment, but if somebody, say, were to be terminated and they had an agreement but they believed that it was against a violation against public policy, but the agreement was, I don't know, Florida agreement. And it's like, well, Florida, we don't, you can't claim that. It's like, right, but inconsistent with the law. So I can't law if you're firing me for a reason that's inconsistent with public policy. So an example of something that would be against public policy would be you can't fire somebody because they've reported you to a regulatory authority. You can't report, you know, you're reporting sexual harassment or lack of patient care or something like that, if you make such a report and you believe your termination is connected to that, that would be a violation of public policy in Vermont. So it was a way to address what the previous language was makes the agreement subject to the laws of other state, which just, I think, raised concerns around how that would play out in practice. And understanding the goal was to make sure that the folks that are working in Vermont under the contract, whether the contract's in somewhere else, but if they're working here in Vermont, they're protected by the Vermont laws.

[Marc Mihaly (Chair)]: Which follows, as I understand it, kind of, area of law is called choice of law, and choice of law has become more difficult as people work remotely, but as to, I have a question about E, but as to B, I think it works, because she's added any provision. So it says, in sum, with all the verbiage, any provision of a contract that includes a restriction is void, and so that's Vermont law, right? So D is if that provision is inconsistent with Vermont law. So if I'm working in New York, and I have a contract, and it provides my salary and my terms of work and vacation and everything else under the sun, if that contract were to provide, for example, that I, as a traveling nurse, it limits, it's a restriction on whether I can move to another geographical area, etcetera, that provision would be void. The contract would survive, but that provision would be void, as well as any other provision that contradicted Vermont law, which I think is the intention here.

[Saudia LaMont (Member)]: Yes? I'm just curious whether precisely because somebody might want, because there exists sometimes the capacity and the interest to shop for the state law that benefits somebody. Do we want to posit that Vermont law is always gonna be the best interest? Is gonna always have the We're just assuming that that's gonna be the best, in the best interest of the provider.

[Marc Mihaly (Chair)]: This does

[Saudia LaMont (Member)]: I mean, I'm here, I love Lamoille.

[Marc Mihaly (Chair)]: Don't think it's broad, as you fear, because it only refers to the provision. By adding provision, she's really dealt that, I think. It's the provision that would have to do with this stuff that would be void. I mean, let's say, for example, I don't know, I can't think of something off the top of my head, but my New York contract had some other thing that was contradicted in some technical way, Vermont law. I don't think Vermont this would not make Vermont law trump that contract. It's that provision that is affected. I guess my question has to do with health, which is difficult.

[Saudia LaMont (Member)]: There's no health.

[Sophie Tidatney (Office of Legislative Counsel)]: Health in the evening.

[Marc Mihaly (Chair)]: I'm wondering if we don't have to say requires litigation arising from the performance of the provision of the contract, or the term of the contract? I'm just asking you, because let's assume, I don't know whether that makes sense to you.

[Sophie Tidatney (Office of Legislative Counsel)]: Well, I think the goal with this is to, again, it's to move that conflict of drugs approach, is that if the issue that you're in litigation over has a connection to Vermont, so it was really just trying to, and we're here talking about contracts. So contracts under choice of law provisions often will be where the headquarters of the company is, where the contract was entered into. Let's just assume that if traveling nurses, it's an Ohio contract, it says all disputes are gonna be resolved in Ohio. Right. So what I think the goal of this particular subdivision is to say that if your dispute involves the performance of the contract here in Vermont, there's a Vermont link to it, then it should be conducted, the litigation should occur here in Vermont, It's my understanding of what the goal was.

[Marc Mihaly (Chair)]: Well, let me ask you, I don't know that much about provision of law, I mean, about choice of law, but in choice of law litigation, can you divide the contract? In other words, can a judge let's say the litigation is occurring in Ohio or this choice of law. Can a judge in Ohio say, I'm going to apply Vermont New York law except I'm going to provide Vermont law with respect to this subject.

[Sophie Tidatney (Office of Legislative Counsel)]: To me, truth of law is a whole huge, huge issue. I mean, my understanding in Vermont is different courts, different states look at conflict of law issues, choice of law issues differently. In Vermont, it sort of follows a significant relationship, like what is the relationship between Vermont and whatever the litigation is. But in terms of getting into exactly how courts are going rely on specific arguments, and again, this was language that was proposed to the committee, so

[Marc Mihaly (Chair)]: I'll just push this a little further and then drop it. Okay? I don't want to get too technical here. What we're saying is that any provision of a contract is void and unenforceable if it requires litigation arising from the performance of the of the contract in Vermont to be conducted in another state. Right? So that means that any contract which has a clause saying everything in this contract is litigated in Ohio is that provision is void and unenforceable. Right? So that would mean that anybody who works here and is based in another state, section of law of their contract that says trial occurs in their home state or wherever is unenforcement. So, what

[Sophie Tidatney (Office of Legislative Counsel)]: the goal was, was really to add in, and maybe this doesn't do it well enough and that needs more work on it, but was to, the subject of the litigation involved and again we're talking about contracts not know, torts or whatever, but if the subject of the litigation was arising from facts that occurred here in Vermont, then the litigation would take place here in Vermont. So if it was something that was, something with the formation of the contract that happened in Ohio and the individual's claiming they were unduly pressured into signing it or something like that, but all that conduct happened in Ohio where the contract was formed, then this wouldn't apply like that. But if it's to do with somebody's performance under that contract here in Vermont, then that was what the goal of the And language again, maybe it's not accomplishing that.

[Marc Mihaly (Chair)]: Well, actually, I guess my feeling, I wanted to just talk it through, my feeling is I don't care very much. If this is overbroad, so be it. All it means is that, you know, some judge somewhere is gonna have to figure out which state law to apply, and if they decide to apply Vermont law instead of Ohio law, great. So I'm uncomfortable with this. Okay. So

[Ashley Bartley (Vice Chair)]: If it's a specific it involves the nondisclosure, what angles that we are putting in, could a judge choose

[Marc Mihaly (Chair)]: The home state law. The non solicitation. Right. I mean, if

[Ashley Bartley (Vice Chair)]: it involves part of what we are writing, that's not in the home, that's the employer's from state that protect them from

[Sophie Tidatney (Office of Legislative Counsel)]: So I mean, often you may have a situation where it can happen different ways, but you could have a claim that's brought in state court in Ohio, but the court would be applying Vermont to Watergate or looking at court in Vermont, but personally you could have a case brought in Vermont where they're looking at someone else's law on it. Often you might end up in the report again if we feel like a new photographer's new branch schedules.

[Marc Mihaly (Chair)]: But if they're here and they're

[Ashley Bartley (Vice Chair)]: in Vermont and they say, I love Vermont, I want to go down 10 miles down the road to this little town and start my own private practice, under Vermont law they can do that. If they're not challenged under another state's law. So have we achieved what we want to achieve if the discretion of the judge, they can be tried

[Marc Mihaly (Chair)]: under I think the worst thing that could I mean, this might be a little overbroad, but at the moment, what I think it means is if a judge in Ohio, in my example, have a choice. Of course, they can do whatever the hell they want, judges, after all, but they could say, or Court of Appeals could say, Well, I have to make a choice between Vermont law should apply or Ohio law. And I could easily see them saying, as Sophie just said, I could easily see them saying, it's true the contract was formed in Vermont, but the performance of the contract in dispute here was in Vermont, so I'm applying Vermont law. Can decide to The do other thing they can decide to do, I think they could say, I'm going to apply let's say it's a multiple cause of action case includes including, as Sophie said, I was coerced into the contract or whatever, the judge could say, I will apply for Ohio law with respect to all of the claims except the claim that has to do with restriction to move, because that Vermont law is very specific on it, I'm going to apply Vermont law with respect to that. I think they could do that, but I'm not a choice of law expert. Is it?

[Sophie Tidatney (Office of Legislative Counsel)]: So we're talking about contracts here, so essentially the way we've come about would be somebody for your dentist, for example, would be saying you've breached the contract, which had a contract that said you could not open a practice within 10 miles of where you're currently working. And then the defendant in that case, the dentist would say, but that's an unenforceable provision, in the contract that I sign.

[Saudia LaMont (Member)]: Just, You're yes, and then the judge, saying the judge, the judge, the judge, but depending on where that judge, or is it always going to end up in federal because it's too safe? They have to fight it out and so it like

[Marc Mihaly (Chair)]: Well, often judges have to decide. State court judges have to decide who's allowed to apply.

[Saudia LaMont (Member)]: And they can apply in other states' law even though they're not from that state? Okay. That was and if the person was to open up within 10 miles but on the New Hampshire side, or the New York side, or the Massachusetts side That

[Marc Mihaly (Chair)]: point, it could. Now it's in another state. It's in another state and that state's law would apply. This is limited to somebody who's providing services in Vermont, right? Well, they're

[Ashley Bartley (Vice Chair)]: providing Yeah, if services I chose the Vermont in And go to Charlton, New Hampshire,

[Marc Mihaly (Chair)]: across the bridge. Well, New Hampshire had a similar position.

[Ashley Bartley (Vice Chair)]: Joe is next, sorry.

[Sophie Tidatney (Office of Legislative Counsel)]: Go ahead.

[Marc Mihaly (Chair)]: This is all I'm saying is choice of law, there's only so much we can do about the complexity of choice of law here. The reality is what we're really trying to do is deal with the situation where a visiting nurse gets an offer and they want to take it, and they get a nasty letter from their provider, they can go to the hospital's lawyer who will say, look, this is pretty fine. Yeah. Yeah.

[Joseph Parsons (Member)]: I guess I'm just trying to understand to me, it seems that it's trying to well, this is an ignorance situation that's so widely used. I'm just trying to understand the makeup of that. My understanding that you like, you could have a Vermont resident working in Vermont that works for a traveling nurse company in Michigan. Right. But you're an employee of a Michigan company and the contract is between the hospital and a Michigan company. And the fact that you live and reside in Vermont and work in a Vermont hospital has nothing to do with the fact that you work for

[Marc Mihaly (Chair)]: a Michigan company. Except this provision of Vermont law would trump the contract with Michigan to the extent it contradicted it.

[Ashley Bartley (Vice Chair)]: So I have a procedural question, and just a thought that

[Marc Mihaly (Chair)]: And I just want to add, I think it most likely that a judge would apply the law of where where and there's ways to do that. The hospital here that wanted to hire the nurse would move to remove the case to Vermont or something like that or apply or or move in in in It's complicated, but there's lots of ways that the Vermont law could trump.

[Ashley Bartley (Vice Chair)]: Yes? So I have two thoughts. Is this something that should be reviewed in fiduciary?

[Marc Mihaly (Chair)]: I hope not. Already? So I'm gonna say it. Okay.

[Ashley Bartley (Vice Chair)]: Occurs to me, and the reason I think I'll tell you what, I promise I'll talk to Marc's, okay? This, in ways that they haven't really been thinking about, might be a good thing for healthcare in rural communities. The ability for somebody to come to Vermont, because people come to Vermont for all kinds of reasons now, but I love it here.

[Marc Mihaly (Chair)]: And I have to wait a year before I can take the job, yeah.

[Ashley Bartley (Vice Chair)]: Yeah, or, you know, set up my tooth clinic or whatever. I mean, a visiting nurse would be hired, but

[Marc Mihaly (Chair)]: still a doctor, it could be a doctor. Or an MP. Yes. Yes, Gayle.

[Gayle Pezzo (Member)]: Would that impede other states being attracted to allowing their resident nurse or whatever going into outer state? Right. In

[Marc Mihaly (Chair)]: other words, let me reframe this. I thought about this. By having a provision like this, are we deterring a traveling nurse company from doing business in Vermont? What we're hearing well, the testimony that we had, and we will finalize this and then bring it back on Tuesday. Okay? And so we could have more testimony, you guys here, we could have more testimony, but my memory of Jess Jessa, you wanna say your name for the record? So you're

[Jessa Barnard (Vermont Medical Society)]: Jessa Barnard with that site.

[Marc Mihaly (Chair)]: Right. My memory is that your testimony indicated that New Mexico, was it New Mexico, had a similar provision, and they did not find that to be the case. They did not find that they suddenly couldn't get Bradley nurses or whatever because people didn't wanna do business with them because they prohibited these kinds of things. But my concern also is that I was asking Sophie this the other day, nurses,

[Gayle Pezzo (Member)]: they don't have reciprocity in every single state. So you're narrowing it with the agency. Let's say it's New York, then they would only be able to go to those states that where there's reciprocity. And now you're narrowing it even more where they may not want to send to those couple of states like Vermont that has this particular law.

[Marc Mihaly (Chair)]: I don't think, I don't know what the license reciprocity requirements are for nursing. Jessa, do you know?

[Sophie Tidatney (Office of Legislative Counsel)]: Jessa Barnard with the medical study, I'm not intimately familiar with the nursing licensure compact, but I would just say generally, I don't think this type of employment contract law intersects with the white with licensure in any way. I think it's two separate.

[Marc Mihaly (Chair)]: Laura, would you say your name?

[Saudia LaMont (Member)]: Laura, and MMI represent a number of the healthcare providers in the state. So we have a nurse licensure compact, which allows for easier free flow across state lines for all states that are placed in that

[Marc Mihaly (Chair)]: compact, yes. Would compact, would the illness provision violate that compact? I don't believe so. I don't believe so. Perhaps. We're gonna revisit this on Tuesday, I hoped. I it's my hope that two thirty can leave this committee next week sometime. It would be good for you to double check. Could you double check and be prepared to reaffirm that position? Great. Other questions of Sophie on this draft? Sophie, I think it's fair to say that you do not have to spend your weekend revising this draft. I think that this is the draft that we'll bring back for discussion on Tuesday, alright? And we'll give you, preliminarily, we're talking about early afternoon, like 1PM, for your benefit, Jessa and Gloria. Okay, Laura. Now I have a question for the committee. We currently have scheduled for next week, which is just, we've begun the schedule, we have, following 02:30 in the afternoon, have 03:28, and we can so my question of the committee is, right now we have scheduled 03:28 in which we would discuss the Burrows amendment and the whole issue of universal design as a first take, that's scheduled for 01:00 today. We could move that and commence that discussion on Tuesday afternoon where it's all set, And I just wanna know what's your thinking on that? I have two

[Saudia LaMont (Member)]: thumbs up. Yeah. Definitely.

[Marc Mihaly (Chair)]: Does anybody object? He can come at 11:30 oh, this is Cameron, on 03/28. And that assumes the floor. Today. Oh, today. I think if we're gonna just move it. So if people are willing Yep. Elizabeth, are you okay with that? Yes. Are people okay then if we would be done for the day to day? I mean, I hate to do this to you, particularly since you're all here.

[Sophie Tidatney (Office of Legislative Counsel)]: Since you're all we've come to the Caucus for Remote Economy. Yes,

[Marc Mihaly (Chair)]: we could, at So, four, that I think that's what we'll do, if that's okay, Jessa, is that all right with you? Okay, it works for you? Yep. Okay, so what we'll do is we'll tape all of this up first 02:30 and then 03:28 on next Tuesday after the floor, which you can

[Sophie Tidatney (Office of Legislative Counsel)]: Probably after the masses, there's not It'll be like 01:00.

[Marc Mihaly (Chair)]: It'll be like 01:00, yeah. Alright, absent something on the floor that, I don't know, S89 would be on the floor, that could be really controversial. Right, Elizabeth? I mean, you're reporting a gun, anything could happen. Sorry. Any

[Saudia LaMont (Member)]: further comments? Well, I'm thinking that

[Sophie Tidatney (Office of Legislative Counsel)]: I figured Mary will be okay. Basically,

[Marc Mihaly (Chair)]: let's discuss briefly, if I might, the field trip for Thursday. So when you don't know what the field trip is?

[Saudia LaMont (Member)]: Because she was out of the room. Yeah. She came in once we were on a date starting

[Joseph Parsons (Member)]: I'm joking for the people on the record.

[Marc Mihaly (Chair)]: Actually, I got money. We can fly the entire

[Saudia LaMont (Member)]: There's no money. We're not flying anywhere. We are thinking of going out to Colchester and Essex to

[Marc Mihaly (Chair)]: look at We're going to go visit a manufactured home community, and it just happens to be a limited equity co op, that isn't, it just happens to be the biggest one in the state. Second. Limited equity co op, the second biggest. And so, what time would that happen? Would we leave here, would we schedule it for 09:30, or would we schedule 09:30, does that work? Still

[Sophie Tidatney (Office of Legislative Counsel)]: working, but we don't have the time frame, but just the outline of the day.

[Marc Mihaly (Chair)]: Then there's a possibility, because it's in the immediate vicinity, that we would go to frameworks. The new frameworks, which is a builder. It's a builder that you, what it do? Brush a bill.

[Sophie Tidatney (Office of Legislative Counsel)]: You go.

[Marc Mihaly (Chair)]: And then there is a possibility, various suggestions have been made in the immediate vicinity, We will need to eat. We can have a committee lunch. And I repeat my offer to have a committee dinner at some point in a while, if we could do the committee lunch now, I'll offer to do a committee dinner, cooking for everybody, and according to their dietary needs, including of course our committee assistant and our committee council. Is there any, and I've done this before, I love to cook, so any final statements, thoughts before we adjourn for the day? We are adjourned.