A new chapter begins
Noncompete agreements under the spotlight
Noncompete agreements under the spotlight
The Federal Trade Commission (FTC) opted not to appeal a decision voiding its ban on noncompetes. However, the agency is putting employers on notice that it intends to “uproot the worst offenders and restore fairness to the American labor market” by shining a light on unfair and anticompetitive noncompete agreements. The agency is taking a case-by-case approach to enforcement, as indicated by the following actions it took this year:
- Launching a joint labor taskforce in February to focus on enforcing federal antitrust laws to protect competition in labor markets.
- Initiating a public inquiry in September to better understand the scope, prevalence, and effects of employer noncompete agreements, and to gather information to inform possible future enforcement actions with comments due by November 3, 2025.
- Entering into a proposed consent order in September with a pet cremation company to stop the company from enforcing noncompete agreements.
Meanwhile, there’s increasing variation across states regarding the treatment of noncompete agreements. Most recently, some states tightened restrictions on noncompetes (e.g., Virginia and Wyoming) while others have loosened them (e.g., Florida).
is a Partner and Senior Legal Consultant in Mercer's Law & Regulatory Group (L&R) based in New York. She specializes in technical legal and regulatory issues affecting executive compensation and corporate governance. She focuses on SEC disclosure, tax, employment and change in control agreements, equity programs, and employee benefit issues that arise in the context of corporate transactions and initial public offerings.
is a Senior Legal Consultant in Mercer's Law & Regulatory Group (L&R) based in Washington DC. She provides expert analyses on a variety of US and Canadian compliance and policy matters, and advises clients on securities and corporate governance issues affecting executive pay in North America.