Noncompete

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As previously reported, the Federal Trade Commission (FTC) proposed a rule on January 5, 2023, that would ban noncompetes nationwide. There are serious questions about the FTC’s authority to promulgate such a rule and many practical reasons why such a sweeping approach is unwarranted—in particular at the federal level. The period for submitting formal comments to the proposed rule lasts 60 days following publication of the proposed rule in the Federal Register. The FTC did not file the proposed rule with the Federal Register until January 18, 2023, and it will not be published until January 19, 2023, meaning that the comment period will end on March 20, 2023—not March 10, 2023, as the FTC initially announced. We are told that there will be a formal request to extend the comment period for an additional 60 days, or until May 19, 2023, and that the FTC is likely to grant the request.
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Continue Reading Comments to the FTC’s Proposed Noncompete Ban Due March 20, 2023 – and the Comment Period May Be Extended Another 60 Days

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You don’t hear much positive news these days about noncompete agreements. Instead, most national media outlets take cases of extreme abuse and frame them as the norm instead of the outliers that they are. And the national media also often portrays employers in a negative light for allegedly forcing noncompetes on employees who purportedly have no choice in the matter and receive no benefit from the transaction. The data does not bear this out—indeed, according to reputable studies, workers who are presented with noncompetes before accepting jobs receive higher wages and more training, and are more satisfied in their jobs than those who are not bound by noncompetes—but that is beside the point when there is an attention-grabbing story to be written.
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Continue Reading Can a Noncompete Increase Competitiveness? Arkansas Football Sure Hopes So.

Governor Steve Sisolak recently signed Assembly Bill 47, which amends Nevada’s statute governing noncompetition agreements (Nevada Revised Statutes 613.195).  Employers should be aware of the following changes to the law, which will go into effect on October 1, 2021.

First, under the amended Nevada statute, employers are explicitly prohibited from bringing an action to restrict a former employee from providing service to a former customer or client if:

  1. the former employee did not solicit the former customer or client;
  2. the customer or client voluntarily chose to leave and seek services from the former employee; and
  3. the former employee

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Continue Reading Nevada Amends Law Regulating Noncompetition Covenants

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Pursuant to a recently passed Oregon state law (HB 2992), noncompete agreements entered into on or after January 1, 2020 will only be enforceable against Oregon employees if the employer provides the departing employee with a signed copy of the agreement within 30 days after the employee’s date of termination.  Though at first blush, this law merely codifies the best practice of reminding departing employees of their continuing obligations to their former employer, it contains a few nuances Oregon employers should keep in mind.

The law requires employers to provide departing employees with a signed copy of their…
Continue Reading New Oregon Law Requires Employers to Remind Departing Employees of Their Noncompete Obligations

On October 20, 2016—just about three weeks before the presidential election won by Donald Trump—the Department of Justice and the Federal Trade Commission issued a remarkable document, entitled “Antitrust Guidance for Human Resources Professionals,” which outlined an aggressive policy promising to investigate and punish employers, and even individual Human Resources employees, who enter into unlawful agreements concerning recruitment or retention of employees.  As stated in that document, “[a]n agreement among competing employers to limit or fix the terms of employment for potential hires may violate the antitrust laws if the agreement constrains individual firm decision-making with regard to wages, salaries…
Continue Reading Antitrust Action Against No-Poaching Agreements: Obama Policy to Be Continued by the Trump Administration

The top story on Employment Law This Week: The DOJ intends to investigate anti-competitive trade practices.

The Department of Justice and the Federal Trade Commission released joint guidance for HR professionals on how antitrust laws apply to employment. The guidance explains that agreements among employers not to recruit certain employees—or not to compete on terms of compensation—are illegal. Notably, the DOJ announced that they plan to criminally investigate “naked no-poaching or wage fixing agreements” that are unrelated to legitimate collaboration between businesses. In the past, both agencies have pursued civil enforcement. Peter Altieri, co-editor of this blog and a Member…
Continue Reading DOJ and FTC Release Antitrust Guidance for Human Resource Professionals – Employment Law This Week

Following up on a string of civil enforcement actions and employee antitrust suits, regarding no-poaching agreements in the technology industry, on October 20, 2016 the Department of Justice (“DOJ”) and Federal Trade Commission (“FTC”) issued Antitrust Guidance for Human Resources Professionals (the “Guidance”). The Guidance outlines an aggressive policy to investigate and punish employers, and individual human resources employees who enter into unlawful agreements concerning employee recruitment or retention.

The Guidance focuses on three types of antitrust violations:

  • Wage fixing agreements: agreements among employers to fix employee compensation or other terms or conditions of employment at either a

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Continue Reading Aggressive New Antitrust Guidance for Human Resources Professionals Threatens Criminal Prosecution for Certain Unlawful Wage Fixing and No Poaching Agreements