The FTC's Final Rule On Non-Compete Agreements Is "Finally" Here

On January 5, 2023, the Federal Trade Commission (FTC)—which protects consumers from anti-competitive, deceptive, and unfair business practices—proposed a rule to prohibit employers from imposing non-compete clauses on workers. After almost a year of public comment, on April 23, 2024, the FTC released its final rule banning the use of non-compete agreements, under most circumstances, nationwide. This is a sea change in the law as it relates to non-compete agreements, which has historically been governed by state law with the enforceability of post-employment restrictive covenants hinging on the unique laws of each jurisdiction. While a uniform law with respect to non-compete agreements will alleviate the need for an employer operating in multiple jurisdictions to have multiple non-compete agreements to comply with each state's law, the FTC's final rule appears to be another example of a federal agency meddling with state law and as a consequence, employers' policies