Center Weighs in on Non-Compete Agreements

July 23, 2021

Anticipating Federal Trade Commission (FTC) rulemaking in response to President Biden’s Executive Order on Promoting Competition in the American Economy, the Center On Executive Compensation expressed strong opposition to a blanket ban on non-compete agreements to the Commission.

The Center highlighted our comments submitted last year that noted non-compete agreements are appropriate and critical for executives and other senior employees.  We also noted legitimate concerns regarding the use of non-competes for hourly and middle-income employees.

The Commission is expected to issue regulatory guidance as early as this fall, with final regulations promulgated next year. 

Outlook:  HR Policy and the Center On Executive Compensation will continue to articulate to the Commission and congressional banking committees our concerns with a “one size fits all” ban on non-compete agreements and will inform stakeholders of the legitimate business needs for such agreements.