Minnesota is joining the growing list of state legislatures targeting non-compete agreements, and doing so with one of the most aggressive laws in the nation on the subject. Included as part of the Senate Jobs and Economic Development and Labor Omnibus Budget Bill (S.F. 3035), the newly-enacted Minn. Stat. Section 181.988 (“Section 181.988”) categorically bans non-compete agreements with Minnesota workers
Continue Reading Gopher State Goes For Broke with Proposed Non-Compete Ban
The UK government has announced that it will bring in legislation to restrict the post-employment non-compete restraints to three months. This is a significant proposal as currently non-compete restrictions in the UK are generally capable of being enforced for a period up to 12 months (if they are “no more restrictive than is reasonably necessary to protect the employer’s legitimate
Continue Reading UK Government Moves to Limit Non-CompetesTuesday, May 2, 2023
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific
1:00 p.m. to 2:00 p.m. Eastern
Join us for a program that will dive into the issues surrounding non-competes in the health care industry. Seyfarth attorneys will engage in a lively panel discussion
Continue Reading Upcoming ACC Houston Webinar: Non-Competes in the Health Care Workplace
The FTC announced yesterday that it was extending the deadline to submit public comments on its proposed rule banning employment non-competes.
With the extension, the FTC will now be accepting comments on the proposed rule until April 19. Originally, the deadline for submitting comments was March 20.
Information on how to submit comments can be found in the Federal Register notice.
On Wednesday, March 8 at 12 p.m. Pacific, Robert Milligan—Seyfarth partner and co-chair of the firm’s Trade Secrets, Computer Fraud & Non-Competes practice—is presenting the “What Does the FTC’s Crackdown on Non-Competes Mean for Trade Secrets?” webinar for the California Lawyers Association.
The panel will discuss:
On February 16, 2023, the FTC hosted a public forum for the purpose of examining the proposed rule banning non-compete agreements. The agenda included, among other things, opening remarks from Chair Kahn, an overview of the rulemaking process by the FTC’s general counsel, a panel discussion, and comments from the public. A recording of the forum is available here.
In her preliminary remarks, Chair Kahn claimed that the proposed rule would increase workers’ earnings significantly and non-competes are an unfair method of competition. She claimed that the FTC has deep expertise on non-competes based upon enforcement, analysis, and addressing public comments. During the explanatory session, FTC staff explained that the comment period ends March 20th and encouraged the submission of additional comments. Staff also explained the functional test in the proposed rule and indicated that the ban applies to any agreement that functionally operates as a non-compete, which could be an overly broad non-disclosure agreement or training repayment agreement. FTC staff stated that the proposed rule does not apply to “run of the mill non-disclosures.”
As earlier reported on this blog, Commissioner Christine Wilson, the sole dissenter in the Federal Trade Commission’s proposed rule banning non-competes, announced yesterday that she is resigning from the agency over her fierce opposition to progressive FTC Chair Lina Khan’s methods of advancing her agenda. In a Wall Street Journal OpEd, Commissioner Wilson took aim at Ms. Khan’s “disregard for the rule of law and due process.” She cited several examples of this alleged disregard for the rule of law and due process, including the FTC’s launch of the rulemaking process to ban nearly all non-compete clauses in employee contracts, affecting roughly one-fifth of employment contracts in the US. As Commissioner Wilson noted in her vigorous dissenting statement to the FTC’s Notice of Proposed Rulemaking (“NPR”), the proposed rule defies the Supreme Court’s decision in West Virginia v. EPA (2022), which held that an agency can’t claim “to discover in a long-extant statute an unheralded power representing a transformative expansion in its regulatory authority.” As Commission Wilson noted in her dissent, and as we have pointed out here and here, the FTC’s NPR purports to undo hundreds of years of state legal precedent—dating from even before the American Revolution—that employs a fact-specific inquiry into whether a non-compete clause is unreasonable in duration and scope, given the business justification for the restriction.
In this episode, Scott Mallery, Dan Hart, and Robert Milligan discuss the FTC’s authority to issue such a broad proposed regulation, and what constitutional challenges to that authority will likely look like. In addition, we discuss legislation that has been introduced in Congress that would not only do essentially the same thing the FTC’s proposed rule would do
Continue Reading Policy Matters Podcast: FTC’s Crackdown on Non-Competes Through Agency Rulemaking Part 2
In an unprecedented move, the FTC has issued a Notice of Proposed Rulemaking that would render unenforceable all non-compete agreements currently in existence (with limited exception), and would bar employers from entering into any contract that that could conceivably prevent a worker from seeking or accepting certain employment, or operating certain businesses, after the conclusion of the worker’s employment with
Continue Reading Policy Matters Podcast: FTC’s Crackdown on Non-Competes Through Agency Rulemaking
US Senator Chris Murphy (D-Conn.) and US Senator Todd Young (R-Ind.) on February 1st reintroduced the Workforce Mobility Act. The legislation would ban the use of non-compete agreements with some limited exceptions. US Representative Scott Peters (D-Calif.-52) and US Representative Mike Gallagher (R-Wis.-08) introduced the legislation in the US House of Representatives. US Senator Tim Kaine (D-Va.) and US Senator Kevin Cramer (R-N.D.) co-sponsored the legislation. The bill was previously introduced in the House of Representatives in 2021.