Trade Associations Take Legal Battle Against FTC on Non-Compete Agreements to US Courts

In the latest twist on the ongoing legal battle between business groups and regulators, a coalition of trade associations, including the US Chamber of Commerce, has filed a lawsuit against the US Federal Trade Commission (FTC) in an effort to overturn a ban on non-compete agreements. The coalition argues that the ban will harm their ability to protect confidential information and investments in their workforce.

The FTC voted 3-2 to approve the rule, which bans most non-compete contracts that restrict workers from leaving for a competitor for a set period and in a specific geographic region. However, this legal battle is far from over, as both sides are likely to continue fighting for months to come. This leaves employers uncertain about the future of non-compete agreements and their ability to enforce them in the United States.

The Chamber of Commerce has been vocal in its opposition to the FTC’s move to ban non-compete agreements, arguing that they are governed by well-established state laws rather than federal regulation. The FTC estimates that around 30 million workers in the US are currently bound by non-compete contracts, impacting not only high-level executives but also hourly employees such as bartenders and security guards. The outcome of this legal battle will have significant implications for the American workforce, including job opportunities and economic growth.