Are Non-Compete Agreements Going Away? The FTC Thinks They Should

Photo by Ian Hutchinson on Unsplash

Last week, the Federal Trade Commission released a new proposed rule that could send businesses into a major tizzy. They propose to ban non-compete clauses (and require employers to repeal any currently in place) to promote a worker’s right to change jobs freely.

I understand why non-compete clauses seem attractive to employers. Companies invest time in hiring and training employees, and they don’t want to see their intellectual capital (trade secrets, mostly) walk out the door and into a competitor’s office. However, non-compete clauses have long been problematic, and I understand that they are not enforced in all states where they currently exist. It often comes down to an employer trying to strong-arm an employee into staying, telling them they will be unemployable and likely sued if they move to leave. Those assertions are not always factual.

See the FTC’s release about the proposed rule here:

If you have strong feelings (as either a business owner or as an employee,) you can contact the FTC (link is in the article) by March 10, 2023, with your feedback. Personally, I am ALL for this rule to go into effect. I have seen first-hand how non-compete clauses have been weaponized to get employees to stay in a job that no longer suits them. It’s a virtual prison in some industries, and I hope the proposed rule is enacted swiftly.