On January 4, 2023, the U.S. Federal Trade Commission (FTC) took legal action for the first time to prohibit the use of noncompete restrictions by three companies and their executives. In doing so, the FTC flexed its newly reestablished standalone authority under Section 5 of the FTC Act. In a partisan 3-to-1 vote, the FTC commissioners voted to issue administrative complaints and accept consent agreements that prohibit the firms and their executives from imposing, attempting to impose, enforcing or threatening to enforce noncompete agreements on a broad swath of covered workers. The orders also require the firms to provide written notice to the thousands of impacted workers that the noncompete agreements are null and void.
Read the full Alert on the Duane Morris LLP website.