Earlier this year, the Federal Trade Commission (FTC) announced a final rule which would have banned almost all non-compete clauses nationwide. The final rule had originally been scheduled to take effect on September 4, 2024.
On August 20, 2024, a federal judge in Texas blocked the ban on non-competes that was set to take effect on September 4, 2024. This means that for now, non-competes will continue to be enforceable under federal law and employers will not have to issue any notices to employees on this subject. It’s important to note, however, that non-competes are still subject to any applicable state requirements.
Employers should watch for appeals on this, but for now, this rule will not take effect. So, it is status quo for non-competes.
As always, if you have questions on this or other compliance issues, reach out to the KMA team today.