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ARTICLE · 31 MAY 2024

United States Ban On Non-Competition Agreements

Gowling WLG
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On April 23, 2024, the United States Federal Trade Commission announced its Final Non-Compete Clause Rule (the "FTC Rule"), establishing a nationwide prohibition against non-compete agreements in employment relationships.

CanadaEmployment and HR
Jordan Epstein
Jordan Epstein
Anita Nador
Anita Nador
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On April 23, 2024, the United States Federal Trade Commission announced its Final Non-Compete Clause Rule (the "FTC Rule"), establishing a nationwide prohibition against non-compete agreements in employment relationships. Once effective, the FTC Rule is expected to have a widespread impact on American workers and business operations.

The FTC Rule is a ban against post-employment non-compete clauses. It defines a non-compete clause as:

A term of employment that prohibits a worker from, penalizes a worker for, or functions to prevent a worker from seeking, working, or operating a business in the United States following the conclusion of employment.

The FTC Rule is intended to be considered broadly and could apply to other contract terms as well, such as overly restrictive confidentiality and non-solicitation agreements. It also imposes pro-active obligations on employers to notify employees that their current non-competition agreements will no longer be

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