On Jan. 31, 100 organizations, including ABC, signed a letter urging the Federal Trade Commission to extend the comment period for its proposed rulemaking on banning noncompete agreements for an additional 60 days. The groups argued that the regulated community should be given sufficient time to assess the potential consequences of the rulemaking and develop insightful comments for the FTC to consider. Currently, comments on the proposed rule are due by March 20 through regulations.gov.

A webinar on the rulemaking will be held for ABC members on Feb. 2 at 2 p.m. ET. Learn more about the webinar and register.

Background:

On Jan. 5, 2023, the FTC issued a proposed rule that would ban all noncompete agreements with limited exceptions. ABC will be commenting in opposition to the proposed rule, which is overly restrictive on well-established and reasonable business practices in the construction industry.

According to the FTC, the proposed rule would make it illegal for an employer to:

• Enter into or attempt to enter into a noncompete with a worker;
• Maintain a noncompete with a worker; or
• Represent to a worker, under certain circumstances, that the worker is subject to a noncompete.

Further, the proposed rule would apply to independent contractors and anyone who works for an employer, whether paid or unpaid. It would also require employers to rescind existing noncompetes and actively inform workers that they are no longer in effect.

To learn more about the new concerning rule, read ABC general counsel Littler’s analysis.