Outten & Golden Celebrates the Federal Trade Commission’s Final Rule Banning New Non-Compete Agreements in the U.S.

April 23, 2024

NEW YORK, NY – Today, the Federal Trade Commission voted 3-2 to enact a final rule prohibiting all new non-compete agreements in the U.S. and making current non-compete agreements unenforceable for all workers except for those entered into by senior executives before the effective date.  The rule is set to take effect 120 days from its publication.  The U.S. Chamber of Commerce has stated, however, that it will challenge the rule in court as early as tomorrow.

Outten & Golden is the largest U.S. law firm focused exclusively on representing workers at all levels. Outten & Golden applauds the Federal Trade Commission’s final rule and its finding that non-competes constitute an unfair method of competition.  Our firm has long advocated for a comprehensive ban on non-compete agreements both nationally and in New York.  It is our long-held belief that non-competes have harmful effects on workers, on competition, on innovation, and on the economy as a whole.

Last April, our firm submitted comments to the FTC advocating for a comprehensive ban on non-competes. Outten & Golden also advocated for an expansive rule limiting the use of other coercive employer tactics that would have the effect of a non-compete, such as certain non-solicitation agreements and garden leave provisions.  Furthermore, our firm’s position is that a ban on non-competes should not have a carve-out for senior executives or an income threshold.

Statement from Wayne N. Outten, Chair and Founding Partner of Outten & Golden LLP

“The new FTC final rule is a hard-fought victory for workers’ rights.  While corporate interests will almost certainly delay this important rule from taking effect, the rule’s message is crystal clear: non-competes have no place in the American workplace.  They prevent all workers — especially low-wage workers — from attaining economic mobility.  They stifle competition and innovation in the free labor market.  They force hardworking Americans to accept inferior working conditions and to remain in abusive workplaces.  Moreover, the threat of costly non-compete litigation alone can prevent employees from starting new businesses or leaving jobs for better opportunities.

“Our Executives and Professionals Practice Group is prepared to advise employees and executives on the enforceability of their restrictive covenants agreements in light of this new rule.

“No matter your job title or income level, non-competes are a coercive tool that unfairly tip the scales of justice at the expense of hardworking people.  While we have a long road ahead, our firm remains committed to ensuring that worker mobility is afforded to all American workers. It’s simply the right thing to do.”

About Outten & Golden LLP

Outten & Golden LLP is the largest U.S. law firm dedicated to the representation of employees. With offices in New York City, Washington D.C. and San Francisco, the firm has taken on many of the country’s largest and most powerful employers, forging landmark settlements and historic verdicts that contribute to a more equitable workplace. The firm’s Executives and Professionals Practice Group focuses on representing executives and professionals in employment contract negotiations at the beginning and the end of the employment relationship. As a mission-driven firm, O&G uses litigation and other means to expand the rights of all employees to fair wages and working conditions and a workplace free of discrimination, harassment and retaliation. Learn more at www.outtengolden.com.