Under this new ruling - the FTC has implemented a ban on the creation of new noncompete agreements with all employees, including top-level executives. According to the final rule, engaging in noncompete agreements with workers is deemed an unfair competitive practice. This final ruling takes a varied stance on existing noncompetes, distinguishing between senior executives and other employees. Senior executives' noncompetes can remain in effect, while the noncompetes of non-executives become unenforceable after the effective date.

Banning noncompete agreements is estimated by the FTC to lead to significant benefits forecasted to be realized within the timespan of the next decade; including reduced healthcare costs, increase in new business formation, and an increase in innovation by means of patents. Additionally, higher worker earnings are expected, with increases in wages. But what else does this entail? Kevin Clark, CEO of Right Discovery, shares a few key takeaways with us.

‍

‍

‍

Topics: Federal Trade Commission, FTC, Noncompete Agreements, Innovation, Patents, Worker Earnings, Wages, Economic Impact, Ruling, Employment, New Business Formation

‍

‍