Federal Trade Commissions Bans Non-Competes

As an attorney that handles both employment litigation and contract negation on behalf of business owners and individuals, I have been seeing no end to questions and comments regarding the FTCs vote to ban Non-competes in late April. Many brokers and owners are making the mistake of believing this applies to their acquisition negotiations. While the FTC is aiming only at the employment sector, it is essential that owners and brokers seek legal counsel in reviewing their current and future employment contracts on file. An attorney will be able to help navigate the 100+ page ruling and how it will affect existing contracts. Special attention should be drawn to the rules “effective date.” Contact our firm by phone, email, or in person for more information.

In their Final Rule, the FTC finds § 910.1 defines “non-compete clause” as a term or condition of employment that either “prohibits” a worker from, “penalizes” a worker for, or “functions to prevent” a worker from (A) seeking or accepting work in the United States with a different person where such work would begin after the conclusion of the employment that includes the term or condition; or (B) operating a business in the United States after the conclusion of the employment that includes the term or condition. This covers a broad range of existing non-competes and it is clear that the FTCs intent is the elimination of these clauses from American Employment law. Though these clauses may still have teeth when applied internationally.

For more information and this and all Employment and Business Law news, please contact our office today.