The bill amends the Rhode Island Noncompetition Agreement Act by introducing new definitions and provisions regarding noncompetition agreements. It defines "annualized earnings" to include various forms of taxable compensation, such as salary, bonuses, and contributions to retirement and health savings accounts. The bill specifies that noncompetition agreements are void and unenforceable against employees unless their annualized earnings exceed $125,000.

Additionally, the bill allows employers to bring civil actions against employees who violate agreements related to trade secrets, enabling employers to seek injunctive relief, compensatory damages, punitive damages, attorneys' fees, and costs. It clarifies that noncompetition agreements may only be enforceable if they are reasonable in scope, time-frame, and application, and are entered into as part of an agreement to sell a business entity or equity interest in a business.

The bill removes previous definitions and restrictions related to low-wage employees and certain types of workers, such as nonexempt employees and students in internships. The act is set to take effect on January 1, 2026.