Center Weighs in on Non-Compete Agreements

Published on: July 23, 2021

Authors: Ani Huang

Topics: ESG and Diversity & Inclusion

Anticipating Federal Trade Commission (FTC) rulemaking in response to President Biden’s Executive Order on Promoting Competition in the American Economy, the Center On Executive Compensation expressed strong opposition to a blanket ban on non-compete agreements to the Commission.

The Center highlighted our comments submitted last year that noted non-compete agreements are appropriate and critical for executives and other senior employees.  We also noted legitimate concerns regarding the use of non-competes for hourly and middle-income employees.

The Commission is expected to issue regulatory guidance as early as this fall, with final regulations promulgated next year. 

Outlook:  HR Policy and the Center On Executive Compensation will continue to articulate to the Commission and congressional banking committees our concerns with a “one size fits all” ban on non-compete agreements and will inform stakeholders of the legitimate business needs for such agreements.