FTC's Final Rule Nixes Noncompetes - What's Next?

On April 23, 2024, in a nail-biting 3-2 decision, the Federal Trade Commission (FTC) voted to publish its final rule banning noncompete provisions in employment agreements.

You can read the entire rule here.

Last year (January 2023), the FTC released a proposed rule banning noncompetes that seemed to stall. The proposed rule defined a "non-compete clause" as one that prevents a worker (employee, independent contractor, or intern) from seeking or accepting employment with a person, or operating a business, after the worker's employment with the employer ends.

And, the FTC made clear that it would ban "de facto noncompetes" too - there's no dressing up a noncompete provision to look like something else, like maybe a non-acceptance of employment provision or a non-interference clause.