NLRB Settles Noncompete Regulatory Action

In May 2023, the General Counsel of the National Labor Relations Board ("NLRB") published a memorandum stating that an employer who requires a nonmanagerial/nonsupervisory employee to sign a noncompete agreement violates Section 7 of the National Labor Relations Act (except in certain narrow circumstances). The General Counsel's memorandum instructed the NLRB's regional offices to seek out unfair labor practice charges against employers who utilize overbroad noncompete requirements.

In what appears to be a test case following the General Counsel's memorandum, the regional director of the NLRB's Region 9 office in Cincinnati, Ohio brought charges in September 2023 against a spa/cosmetic-and-medical business that required certain low level employees to sign an agreement that contained two year noncompete and non-solicit provisions, along with a promise to repay the employer for training that the employee received if the employee departed within two years of being