Safeguarding intellectual property in the modern workplace

In 2024, the Federal Trade Commission (FTC) issued a rule banning most noncompete agreements nationwide. Although enforcement is currently stayed (paused) pending legal challenges, courts and legislatures continue to narrow or eliminate noncompete enforceability—prompting employers to reevaluate how they protect proprietary information and competitive advantage.

In response, many employers are turning to trade secret law. But protection requires more than labeling information “confidential.” It demands proactive, legally sound practices throughout the employment lifecycle—from onboarding through exit. Now more than ever, understanding how trade secret enforcement intersects with employment law is essential in safeguarding your company’s intellectual property and competitive edge.

Shrinking enforceability of noncompete agreements

Even before the FTC’s 2024 rule, states were limiting noncompetes. Some, like California, ban most noncompetes outright. Others, such as Illinois and Colorado, impose wage thresholds or restrict use to certain roles. Where noncompetes remain legal, courts typically apply a reasonableness test to assess whether the restrictions protect a legitimate business interest and are reasonable in duration, geography, and scope.