FTC targets noncompete agreements again—What employers need to do

Under the Biden administration, the Federal Trade Commission (FTC) attempted to pursue a robust regulatory approach to restrict noncompete agreements. Those efforts were derailed in August 2024, however, when a federal court enjoined the FTC rule (which had tried to outlaw most noncompetes). Employers that thought noncompete agreements wouldn’t be an issue with the Trump FTC are forewarned: The FTC will focus on employers whose noncompete agreements, in the FTC’s view, restrict competition and entrepreneurship.

Overbroad noncompete is gateway to FTC complaint

On September 5, 2025, the FTC announced it filed a complaint against Gateway Services, a national pet cremation company with over 100 locations serving 17,000 veterinary clinics, as well as approximately 1,800 employees across the country who signed noncompete agreements.

Beginning in 2019, newly hired Gateway employees were required to sign a noncompete agreement regardless of their job duties. The affected employees ranged from executives to laborers, and the agreements precluded employees from working in the pet cremation industry anywhere in the United States for one year.