FTC Proposes Blanket Ban On Noncompete Agreements

The Federal Trade Commission ("FTC") created waves by announcing a proposed rule last week that—if adopted and survives legal challenge—would largely prohibit employers from imposing or enforcing non-compete agreements on their workers. In a breathtaking flex of regulatory muscle, the FTC's unprecedented proposal would create a nationwide standard that would radically modify the current landscape of restrictive covenants and significantly limit the post-termination protections currently available to many employers. The proposed rule boldly follows the Biden Administration's executive order, which we addressed last year, that encouraged the FTC to exercise whatever legal authority it has to "curtail the unfair use of non-compete clauses" that "may unfairly limit worker mobility".