Beautiful Virgin Islands

Friday, May 09, 2025

U.S. targets non-compete clauses that block workers from getting better jobs

U.S. targets non-compete clauses that block workers from getting better jobs

The U.S. Federal Trade Commission, which enforces antitrust law, proposed a rule that would ban companies from requiring workers to sign noncompete provisions as well as some training repayment agreements, which companies use to keep workers from leaving for better jobs, the agency said on Thursday.
Noncompete agreements "block workers from freely switching jobs, depriving them of higher wages and better working conditions, and depriving businesses of a talent pool that they need to build and expand," said FTC Chair Lina Khan in a statement.

The proposed rule is the latest sign from the Biden administration of its support for labor, including backing a measure to make it harder for an employer to classify a person as an "independent contractor," which generally means fewer benefits and legal protections.

The agency estimated that if the rule goes into effect, wages to U.S. workers would rise by $300 billion per year and an estimated 30 million Americans would have better career opportunities.

The rule, which could be months away from taking effect, would require companies with existing noncompete agreements to scrap them and to inform current and past employees that they have been canceled.

It would also stop companies from requiring workers to reimburse them for certain kinds of training if they leave before a certain period of time, a strategy some companies began using when noncompete provisions garnered tougher scrutiny. The training repayment would be banned if it "is not reasonably related to the costs the employer incurred for training the worker," the proposed rule said.

Sarah Miller, executive director of the American Economic Liberties Project, welcomed the rule, saying "coercive noncompete agreements have unfairly denied millions of working people the freedom to change jobs, negotiate for better pay, and start new businesses."

The U.S. Chamber of Commerce is considering suing to stop the rule but not immediately, said Sean Heather, their antitrust expert.

"We are contemplating legal action," said Heather, saying the Chamber did not believe that the FTC had the statutory authority to issue rules on competition matters.

Challenges to the rule are likely, and will focus on whether Congress clearly authorized the FTC to adopt nationwide bans on what the agency deems anticompetitive practices, according to Kristen Limarzi, a partner at Gibson Dunn & Crutcher LLP and veteran of the U.S. Department of Justice’s Antitrust Division.

"Non-compete clauses are in wide use in some parts of the country, and there will be large employers and interest groups like the Chamber that will be highly motivated to challenge the rule," she said.

Richard Powers, a former acting head of the Justice Department's Antitrust Division, said it's hard to know if the FTC rule would survive a legal challenge. "I think it's probably one of the top questions," said Powers, now at Fried Frank.

The new rule was announced a day after the agency announced that two big glass container makers and a security company agreed to drop noncompete requirements.

Ardagh Glass S.A. and O-I Glass Inc, the two largest U.S. glass container makers, had noncompete provisions that affected more than 1,700 workers. Ardagh typically barred former workers from being employed by another similar company for two years while O-I Glass said the company had to give written consent for former workers to take new jobs in the industry, the FTC said.

FTC Commissioner Rebecca Slaughter said in 2020 that surveys have estimated that 16% to 18% of all U.S. workers are subject to noncompete provisions. Meanwhile, nearly 10% of American workers surveyed in 2020 were covered by a training repayment agreement, said the Cornell Survey Research Institute.
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Historic Papal Conclave Set to Commence in Rome
Huge Copper, Gold, and Silver Discovery in Argentina and Chile — But the Profits Go Abroad
Prince Harry is pleading for reconciliation — but the royals are just as sick of his victimhood as everyone else
The Road to Freedom: She Protested Putin, Escaped House Arrest, and Survived a 2,800-Kilometer Journey
OpenAI's Flip-Flop: No Longer Going Commercial, Back to Nonprofit, After Musk Lawsuit and Backlash
“Trump Supporter” Aims to Bring a MAGA-Style Shift to Romania
First From China: Zhao Xintong Wins the Snooker World Championship
Nvidia Faces Billion-Dollar Losses – Warns: China Is on Its Way to Becoming an AI Superpower
Trump Rules Out Third Term, Names JD Vance and Marco Rubio as Potential Successors
Mexico Says ‘No’ to U.S. Troops: President Sheinbaum Rejects Trump’s Offer to Fight Cartels
Nigel Farage’s Reform UK Storms the Map, Wrecking the Two-Party Monopoly
DOGE: Reimagining Government Operations with AI
Common Sense Returns to Britain's Legal System: UK Supreme Court Declares a Woman Is… a Woman
Beijing Says U.S. Is ‘Reaching Out’ for Tariff Talks Amid Soaring Trade Tensions
U.K. Court Rejects Prince Harry’s Final Appeal Over Police Security
Prince Harry’s Heartfelt Outburst Rocks the Royal Family
Trump Shares AI-Generated Image of Himself as… Pope, Prompting Outrage Reaction
Transgender Swimmer Secures Five Gold Medals at U.S. Masters Championship
Prince Harry: “I Want Reconciliation with My Family”
Germany's Alternative für Deutschland (AfD) party has now been officially labeled “right-wing extremist” by the federal office for the so-called “protection of the constitution.”
Amazon Launches Satellite Internet Service Amidst Competition with SpaceX
Transformative Changes in Women's Wrestling: The Rise of WWE Superstars
The Rush to the White Gold: Global Investment Surge in Natural Hydrogen Exploration
This is a day in Spain without electricity and internet
Reform UK Surprises in British Elections, Challenging Traditional Two-Party System
180-Year-Old Christian University in South Carolina Announces Closure Due to Unmet $6 Million Fundraising Goal
Brazilian Woman Jailed for Fourteen Years for Writing “You Lost, Idiot” on Statue During Protest
Trump Administration Removes National Security Adviser Mike Waltz Amid Signal Chat Controversy
Dutch Politician Eva Vlaardingerbroek Receives Spyware Threat Alert from Apple
Paramount Board Considers Settlement in Trump’s $20 Billion Lawsuit Over "60 Minutes" Interview
U.S. Economy Shrink in Trump’s First Quarter as Tariff Policy Raises Questions
Deadline Looms for RTS Meter Replacement: Hundreds of Thousands at Risk of Heating Disruption
Sweden Grapples with Deadly Gun Violence: Suspect Arrested After Three Young Men Killed in Uppsala Hair Salon
Walz Reveals Why Harris Chose Him as Her Running Mate and Reflects on Democratic Losses
Spain Restores Power After Unprecedented Nationwide Blackout
Carney Secures Liberal Mandate in Canada’s Federal Election
Death Penalty Sought as Luigi Manion Pleads Not Guilty in CEO Murder Case
President Trump contacts Jeff Bezos after reports of Amazon considering listing tariff surcharges; company clarifies no such plan for main platform
Spain and Portugal Recover from Massive Blackout
Liverpool Clinches Record-Equalling 20th English League Title Under Arne Slot
Singapore Politicians Warn Against Foreign Interference in Election
Driver Ploughs into Vancouver Festival Crowd, Killing Nine
Depression, Fear of Defamation, and a Tragic End: New Details on Virginia Giuffre’s Suicide
“Sharia for UK, Allah Akbar!”
Massive Explosion at Iran's Bandar Abbas Port Linked to Suspicious Chemical Shipments
Incident Reflection: A Harsh Reality Check
Pakistani migrants to Danish man: “ “We have 5 children while you have 1 or 2. In 10 years, there will be more Pakistanis than Danes here.“
Clashes Erupt in London as Tensions Rise Between Indian and Pakistani Communities
Specialized anti-drone weapons deployed among security personnel Ahead of Papal Funeral
How do you fix this culture?
×