Non-compete Agreements Are Out

Non-compete agreements have been used by companies to keep departing employees from working with competitors or starting competing businesses. The FTC’s final rule bans the use of non-compete agreements on the grounds that it’s an unfair method of competition. Existing agreements for all but senior executives become void beginning 120 days after the rule’s publication in the Federal Register, which is any day now. Employers are required to provide notice to workers (other than senior executives who are bound by an existing noncompete) that they will not be enforcing any noncompete against them. The FTC has a fact sheet on the final rule. Note: While this is a final rule, it may not be the final word. There are already lawsuits challenging the authority of the FTC to make this rule. #IdeaoftheDay