Notices Under FTC Rule On Non-Competes: What Should I Be Doing Now?

As previously covered on our HR Law Talk blog, the Federal Trade Commission's (FTC) non-compete ban (FTC Rule or the Rule) is scheduled to take effect on September 4, 2024. Issued in April, the FTC Rule prohibits all non-competes arising out of employment relationships – with the exception of existing agreements with "senior executives," as defined by the Rule. Although many legal experts have hypothesized that the federal courts would enjoin the Rule, the future of the FTC Rule remains uncertain. Accordingly, employers must remain informed on the most recent court rulings involving the FTC Rule and prepare as though it will take effect on September 4.

On July 3, the U.S. District Court for the Northern District of Texas enjoined the FTC from enforcing the FTC Rule, finding the FTC did not have the authority to issue such a rule. However, the Northern District of Texas's injunction did not apply nationwide, but rather only to the litigants in that lawsuit. Despite