NLRB Joins FTC In Taking Aim At Non-Competes

Following the FTC's Notice of Proposed Rulemaking seeking to ban non-competes earlier this year, another federal agency has joined the attack on non-competes.

On May 30, the NLRB's General Counsel Jennifer Abruzzo issued a memo to all NLRB regional directors, officers-in-charge and resident officers stating that non-competes in employment agreements and severance agreements violate the National Labor Relations Act except in rare circumstances.

Specifically, Ms. Abruzzo claims that such covenants interfere with workers' rights under Section 7 of the act, which protects employees' right to self-organize, join labor organizations, bargain collectively, and "engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection." Ms. Abruzzo thus concluded that non-competes typically violate Section 8(a)(1) of the act, which makes it an unfair labor practice for an employer to interfere with an employee's Section 7 rights.