Non-Compete Agreements Under Scrutiny, Leaders Respond

Commentary In a landmark decision for the U.S workforce, the Federal Trade Commission (FTC) voted 3–2 to ban most non-compete agreements. These agreements prohibit employees from leaving to work for a competitor or launch a rival enterprise. The new rule automatically terminates most current contracts, forbidding businesses from using them in the future. The FTC says the ruling will encourage innovation. “Non-compete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once noncompetes are banned,” FTC Chair Lina M. Khan said in a statement. “The FTC’s final rule to ban non-competes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”...