TBA Law Blog


Posted by: Stacey Shrader Joslin on Jun 17, 2024

The Federal Trade Commission’s (FTC) effort to broadly ban noncompete agreements faces its first big legal test July 3, the Business Journal reports. A Texas judge is expected to rule then on a preliminary injunction against the ban. If the injunction is approved, the FTC will have to halt implementation of the new rule until the legal process concludes. The new rule would impact 30 million Americans and thousands of businesses, releasing a multitude of workers from existing clauses. The FTC contends the agreements, which limit how and when a worker can find a new job within their industry, are burdensome for workers and stifle economic mobility. Business groups contend noncompete agreements are necessary to protect trade secrets, to encourage investment in research and development, and to foster business growth.