FTC to Decide Whether Noncompete Agreements Should Be Banned
Video Credit: Wibbitz Top Stories - Duration: 01:31s - Published
FTC to Decide Whether Noncompete Agreements Should Be Banned
FTC to Decide , Whether Noncompete Agreements , Should Be Banned.
After receiving over 26,000 public comments about the issue, the Federal Trade Commission is set to deliver its verdict on April 30, NPR reports.
.
The commission said that if approved, the
final rule "would generally prevent most
employers from using noncompete clauses.".
The commission said that if approved, the
final rule "would generally prevent most
employers from using noncompete clauses.".
Approximately one in five Americans, spanning minimum wage workers to CEOs, are subject to noncompete agreements, the FTC estimates.
.
The Biden administration says that these types of agreements hurt workers by decreasing wages.
The White House also argues that these
agreements harm the U.S. economy because entrepreneurship isn't allowed to freely flourish.
.
FTC Chair Lina M.
Khan issued a statement when
the proposed ban was initially introduced.
The freedom to change jobs is
core to economic liberty and to
a competitive, thriving economy, FTC Chair Lina M.
Khan, via statement.
Noncompetes block workers from
freely switching jobs, depriving
them of higher wages and better
working conditions, and depriving
businesses of a talent pool that
they need to build and expand, FTC Chair Lina M.
Khan, via statement.
Businesses argue that noncompete agreements are essential for safeguarding investments and proprietary information.
Those businesses also question whether
the agency has the power "to regulate
such agreements," NPR reports.
.
If the FTC votes to issue a final rule, enforcement wouldn't occur for 180 days,
and legal challenges would likely ensue.
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