Published on: November 22, 2019
Topics: Employment LawNineteen Democratic state attorneys general called on the Federal Trade Commission (FTC) to issue a general ban on non-compete agreements for all workers, including senior executive employees.
The letter points to the FTC’s authority to identify and prohibit “unfair methods of competition” through rulemaking, and contends that an FTC rule would offer “the quickest, most comprehensive regulatory path to protecting all workers” from non-compete agreements.
“Using non-competes,” the letter argues, “employers have bound a wide range of workers—including baristas, engineers, journalists, home health aides, physicians, and sandwich makers—and deprived them of their freedom to use their labor as they choose. Non-competes deprive workers of the right to pursue their ambitions and can lock them into hostile or unsafe working environments.”
Outlook: Several states have passed measures barring companies from including non-compete agreements in employment contracts for low-wage workers. In Congress, the bipartisan Workforce Mobility Act (S. 2614), introduced by Sens. Todd Young (R-IN) and Christopher Murphy (D-CT), would apply to virtually all employers and employees, while a measure by Sen. Marco Rubio (R-FL) would crack down on non-compete agreements with non-exempt employees. Whether these bills will gain momentum remains to be seen, but pressure from the states ensures the issue will become more prominent on Capitol Hill.