FTC Bans Noncompetes
04/23/2024On April 23, 2024, the Federal Trade Commission issued a final rule banning new noncompete clauses in employment contracts for all workers (including independent contractors), except in connection with the bona fide sale of a business entity. In addition, the final rule also makes all existing noncompete agreements, except for those covering senior executives making over $151,000.00 unenforceable. The rule goes into effect 120 days after its publication in the Federal Register.
Employers are required to provide notice to current and former workers that existing noncompete clauses are no longer in effect. It is suspected that enforcement will be further delayed by legal challenges.
We recommend all clients review all noncompete clauses with current and former employees. Please contact us for more information.