New White House Executive Order Encourages FTC to Crack Down on Non-Competes

On July 9, 2021, President Biden signed an executive order encouraging the Federal Trade Commission to create new limits on non-competition agreements. The executive order is part of a larger federal initiative to tackle economic issues, reduce the trend of corporate consolidation, and increase competition. 

Specifically, the new order encourages the FTC to take steps: (a) to ban or limit non-competition agreements; (b) to ban unnecessary occupational licensing restrictions that impede economic mobility; and (c) to work with the DOJ to prevent employers from collaborating to suppress wages or reduce benefits by sharing wage and benefit information with one another. It remains to be seen how the FTC will implement the executive order. Any action by the FTC may also be subject to a legal challenge. In the meantime, employers that use non-competition agreements should continue to monitor this development.

If you have questions about this or any other workforce issue, please contact your relationship attorney or one of Honigman’s Labor and Employment attorneys.