FTC Non-Compete Rule Enjoined Nationwide
Yesterday, a federal district court in Texas issued a nationwide injunction against enforcement of the FTC’s ban on non-compete agreements, which was to become effective September 4. The case is Ryan LLC v. Federal Trade Commission. This ruling means employers do not have to send rescission notices to their current and former employees with non-compete agreements.
While this ruling is welcome news to employers who were trying to decide what to do on September 4, the battle is not completely over. The FTC can appeal the ruling. Ultimately, the Supreme Court may have the final say. The FTC, in response to the ruling, has vowed to continue scrutinizing non-compete agreements that it considers to be unfair to workers. The National Labor Relations Board also thinks non-compete agreements are illegal and that it has authority to invalidate them. The outcome of the presidential election will have an impact on whether these agencies continue to target non-complete agreements.
We recommend our clients use this opportunity to review their approach to safeguarding proprietary information and protecting themselves against competition from employees who leave the company.
Our Labor and Employment Group is available to partner with you to formulate the best approach for your business in this challenging environment.
Written By: Trip Umbach
If you have any questions or need legal support, please contact:
Trip Umbach 205-868-6072 or tumbach@starneslaw.com
Alfred Perkins 205- 868-6024 or aperkins@starneslaw.com
Breanna Young 205- 868-6020 or byoung@starneslaw.com
Grace Ann Azar 205-868-1760 or gazar@starneslaw.com
Averie Jones 205-868-6043 or ajones@starneslaw.com
Scott Stevens 251-405-5067 or sstevens@starneslaw.com
Weathers Bolt 251-445-4718 or wbolt@starneslaw.com
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