Catherwood LibraryILR School

The Federal Trade Commission ruled earlier this week that companies will no longer be able to have noncompete clauses. Noncompete clauses are agreements that employees sign stating that they cannot work for or begin a rival company. The FTC received thousands of comments from workers around the United States, stating how noncompete clauses have negatively impacted their careers. Noncompete clauses may cause workers to stay at a company even if it is not a right fit, because they are prohibited from joining other companies in the same industry. It is estimated that over thirty million workers are bound to noncompetes. The FTC states that banning noncompetes can lead to significant increases in wages, as it will provide workers with greater economic freedom. The one expectation of the ban on noncompetes is the noncompetes signed by senior executives in a company, a these agreements most likely were negotiated between the company and the senior executives.