FTC Issues Final Rule Banning Worker Non-Compete Clauses

On April 23, The Federal Trade Commission (FTC) issued a final rule to ban worker non-compete clauses. The new rule would prohibit existing non-competes for the vast majority of workers after the rule’s effective date. Existing non-competes for senior executives, defined as workers earning more than $151,164 annually and who are in policy-making positions, can remain in force but employers are banned from entering into or attempting to enforce any new non-competes, even if they involve senior executives.

The Commission vote to approve the issuance of the final rule was 3-2. The final rule will become effective 120 days after publication in the Federal Register.

To read the text of the final rule, CLICK HERE.
To read a factsheet on the final rule, CLICK HERE.
To read the FTC press release, CLICK HERE.