FTC bans non-compete agreements

The Federal Trade Commission (FTC) voted 3-2 Tuesday to ban noncompete agreements that prevent tens of millions of employees from working for competitors or starting a competing business after they leave a job.

From fast food workers to CEOs, the FTC estimates 18 percent of the U.S. workforce is covered by noncompete agreements around 30 million people.

The final rule would ban new noncompete agreements for all workers and require companies to let current and past employees know they wont enforce them. Companies will also have to throw out existing noncompete agreements for most employees, although in a change from the original proposal, the agreements may remain in effect for senior executives.
It is so profoundly unfree and unfair for people to be stuck in jobs they want to leave, not because they lacked better alternatives, but because noncompetes preclude another firm from fairly competing for their labor, requiring workers instead to leave their industries or their homes to make ends, said FTC Commissioner Rebecca Slaughter (D) in prepared remarks.

The new rule is slated to go into effect in 120 days after its published in the Federal Register. But its future is uncertain, as pro-business groups opposing the rule are expected to take legal action to block its implementation.

Business groups say noncompete agreements are critical for protecting proprietary information and intellectual property, although the rule would not ban other methods for protecting that information, including nondisclosure and confidentiality agreements. They also question the agencys authority to issue the blanket, retroactive ban.

Congress has not given the agency explicit authority to ban noncompetes, although there have been several bipartisan bills introduced to reform noncompete agreements, including the Workforce Mobility Act sponsored by Sens. Chris Murphy (D-Conn.), Todd Young (R-Ind.), Tim Kaine (D-Va.) and Kevin Kramer (R-N.D.), and the Freedom to Compete Act sponsored by Sens. Marco Rubio (R-Fla.) and Maggie Hassan (D-N.H.).

The U.S. Chamber of Commerce, the largest pro-business lobbying group in the country, has said it will sue to block the rule.

While the dissenting commissioners said they did not support noncompete agreements carte blanche, they did not believe the agency had the authority to issue the rule without an express directive from Congress.

Beginning with policy puts the cart before the horse, said FTC Commissioner Andrew Ferguson (R). No matter how important, conspicuous and controversial the issue, and no matter how wise the administrative solution, an administrative agencys power to regulate must always be grounded in the valid grant of authority from Congress. Because we lacked that authority, the final rule is unlawful.

The lawsuit would be the latest battle between the business community and President Bidens administration, with agencies including the FTC rolling out measures to crack down on corporate price gouging, junk fees and alleged anti-competitive behavior. Last month, the Chamber led a lawsuit challenging a Consumer Financial Protection Bureau rule that caps credit card late fees at $8 for the largest issuers.

Now ban mandatory arbitration agreements

and then struck down by the supreme court for made-up reasons

Now ban mandatory arbitration agreements

Sadly it fails the important legal test of "what would a late 18th century white slave owner do"

Oh for sure. Give it a year, maaaaaybe two and itll be on the Supreme Courts chopping block. They need to remind us were nothing but disposable wage slaves.

Now ban "right to work" states

lol at the optimism

the article says the chamber of commerce is planning to sue immediately

this will certainly be blocked by a trump appointed judge before it even goes into effect

https://thehill.com/business/4615452-ftc-votes-to-ban-non-compete-agreements/

i suspect this will be blocked by a chud federal judge immediately and then struck down by the supreme court for made-up reasons

Sadly it fails the important legal test of "what would a late 18th century white slave owner do"

lol at the optimism

the article says the chamber of commerce is planning to sue immediately

this will certainly be blocked by a trump appointed judge before it even goes into effect

The chamber of commerce is just a lobby group, not an actual government entity.

In my experience they've largely been hard to enforce, but this is a good thing to make sure

Come on. If non-compete agreements were largely unenforceable in practice there wouldn't be business groups suing to try to stop this ban.

but they are largely unenforceable. they're also largely unchallengeable for people who need jobs and can't afford to waste money on a court case. and all the people who don't know their rights.

yeah, and theyre planning on suing to block this for the businesses they lobby for

Every single piece of legislation passed on the federal, state, or municipal levels brings lawsuits.

Every one of them.

Did this come out of nowhere? I don't think I had heard they were considering this.

No, it's been in the works
https://www.vox.com/recode/2023/1/5/23540951/noncompete-agreements-ban-biden

I dont know what you think youre arguing

Literally everyone sues every piece of legislation.

"It won't matter, they're suing"

Literally everyone sues every piece of legislation.