The Federal Trade Commission (FTC) has been fighting to ban noncompete agreements for workers, and their efforts have faced opposition from Ryan LLC, the US Chamber of Commerce, and other business groups. The FTC estimates that one in five US workers are bound by these agreements that limit their ability to switch jobs freely, reduce wages, stifle innovation, block entrepreneurs, and undermine fair competition.
In April, the FTC approved a ban on noncompete clauses in employment agreements. However, shortly after approval, Ryan LLC and other business groups sued the agency. The US Chamber of Commerce celebrated the preliminary injunction as a victory against the FTC’s unlawful power grab.
Despite the delay in implementation of the ban on noncompete agreements for workers originally scheduled to take effect on September 4th in the U.S. District Court for the Northern District of Texas, Judge Ada Brown stated that she intends to rule on the ultimate merits of the action by August 30th, 2024. The court’s order does not prevent the FTC from taking enforcement actions against noncompete agreements on a case-by-case basis. This ongoing news story will be updated as new information becomes available.