FTC Issues Final Rule Banning Most Non-Compete Agreements

On April 23, 2024, the Federal Trade Commission ("FTC" or "the Agency") voted 3-2 along partisan lines in a special public meeting to adopt the " Non-Compete Clause Rule" (the "Final Rule"), which will prohibit most employee non-competes with retroactive effect, except existing non-compete provisions of "senior executives." The Final Rule will also ban future non-compete agreements, including for senior executives, with limited exceptions. The rule will not become effective until 120 days after publication in the Federal Register, and covered employers will be required to comply with the Final Rule by that effective date, which could come as early as August this year. By the FTC's own estimate, this ban could affect up to one-in-five American workers.