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Federal Trade Commission Issues New, Nationwide Rule Banning Non-Compete Agreements, But Don’t Expect It to Last

By Brian Markovitz

On April 23, 2024, the Federal Trade Commission (FTC), voted (3 to 2) to essentially stop employers from issuing new non-compete agreements for most workers in private industry.

Non-compete agreements are agreements that employees sign that prohibit them from changing jobs or working for competitors. These agreements, with rare exceptions, are not something that employees want to sign, but something they must sign as a condition of their employment in order to get a job.

A court challenge is expected by the Chamber of Commerce, among others. This matter could well land before the Supreme Court. If it does, the National Labor Relations Board’s prohibition on employers forcing employees to waive their rights to participate in class actions through mandatory arbitration agreements, the Court will probably strike down the rule. The good news for those that live in a handful of states and the District of Columbia is that there are either complete bans on non-compete agreements or they are restricted to certain high-income earners. Before signing any such agreement, please check to see if you are in one of those jurisdictions.

About The Author

Brian Markovitz

“I believe that litigation should be the last resort. Compromise is usually better. But when compromise isn’t possible and negotiating peacefully fails, we’ve got the tools, resources, and experience to help our clients in difficult situations dealing with difficult people.”

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