FTC Proposes Ban on Non-Compete Clauses
Sweeping New Rule to Promote Workforce Mobility
The Federal Trade Commission (FTC) will vote on Tuesday on a proposed final rule that would ban employers from imposing non-compete agreements on their workers, including low-wage employees.
Non-compete clauses are common in employment contracts and prohibit employees from working for a competitor or starting their own business in a certain industry or geographic area for a specified period of time. The FTC argues that these clauses are anti-competitive, limit worker mobility, and stifle innovation.
The proposed rule would apply to all employers, regardless of size or industry. It would also be retroactively applied to existing non-compete agreements. Employers would be required to provide workers with a written notice of the ban.
The FTC has received over 55,000 public comments on the proposed rule, with many businesses expressing opposition. The National Chamber of Commerce argued that the rule would "harm businesses and workers alike." However, labor unions and worker advocacy groups have praised the proposal, calling it a "game-changer" for working Americans.
The FTC's vote on Tuesday will be closely watched by businesses and workers alike. If the rule is approved, it would be a major victory for worker rights and a significant blow to the use of non-compete clauses in employment contracts.
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