New federal rule would bar companies from forcing 'noncompete' agreements on employees

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Noncompete Agreements News

Federal Trade Commission,Federal Agency,Competing Companies

WASHINGTON (AP) — U.S. companies would no longer be able to bar employees from taking jobs with competitors under a rule approved by a federal agency Tuesday...

WASHINGTON — U.S. companies would no longer be able to bar employees from taking jobs with competitors under a rule approved by a federal agency Tuesday, though the rule is sure to be challenged in court.

When it proposed the ban in January 2023, FTC officials asserted that noncompete agreements harm workers by reducing their ability to switch jobs for higher pay, a step that typically provides most workers with their biggest pay increases. By reducing overall churn in the job market, the agency argued, the measures also disadvantage workers who aren't covered by them because fewer jobs become available as fewer people leave jobs.

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