The Federal Trade Commission's ban on noncompete agreements in employment contracts faces legal challenges that may prevent it from ever taking effect.
In April 2024, the Federal Trade Commission (FTC) issued a nationwide rule banning the inclusion and enforcement of noncompete clauses in employee contracts. If the rule goes into effect on September 4, it will shake up business competition. Even if the ban is not implemented—which appears likely amid recent legal challenges—the arguments for the rule's establishment will likely influence future legal decisions on noncompete agreements.
In this article published by the MIT Sloan Management Review, Goodwin partner Robert Frederickson answers commonly asked questions about the FTC rule and shares how business leaders can prepare for its potential effects. Companies should, for instance, consider alternatives to noncompetes for protecting their intellectual property when employees depart, he writes.
Read the full article: What's Next for the FTC's Ban on Noncompetes?
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