FTC Proposes Rule to Ban Noncompete Clauses

In January 2023, the Federal Trade Commission (FTC) released a proposed rule to ban noncompete clauses. According to the FTC, approximately 30 million people are bound by a non-compete clause, which is a contractual term between an employer and a worker that blocks the worker from working for a competing employer or starting a competing business, typically within a certain geographic area and period of time after the worker's employment ends.
The FTC's proposed rule would generally prohibit employers from using noncompete clauses. It would make it illegal for an employer to: 
  • Enter into or attempt to enter into a noncompete with a worker; 
  • Maintain a noncompete with a worker; or 
  • Represent to a worker, under certain circumstances, that the worker is subject to a noncompete. 
The comment period is open through March 10, 2023, and you can find more information here for submitting comments. 
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