New Executive Order May Have Dramatic Impact On Noncompete Agreements

President Biden's new executive order could bring changes for employers that rely on noncompetition agreements to protect trade secrets. In a sweeping executive order, Biden asked the Federal Trade Commission (FTC) to ban or limit noncompetes. He argued that these agreements limit economic growth and prevent competition.

The stated goal of the order is "[t]o address agreements that may unduly limit workers' ability to change jobs, the Chair of the FTC is encouraged to consider working with the rest of the Commission to exercise the FTC's rulemaking authority under the Federal Trade Commission Act to curtail the unfair use of noncompete clauses and other clauses or agreements that may unfairly limit worker mobility."