What FTC’s noncompete ban means for Massachusetts employers

On April 23, 2024, the Federal Trade Commission (FTC) voted 3-2 to implement a total ban on noncompete agreements for nearly all workers across the country. Noncompete agreements generally prohibit workers from moving to or starting competing businesses for a designated period. According to the FTC, 30 million Americans—roughly one in five workers—are now subject to noncompete agreements. Within days, lawsuits challenging the ban were filed, and others were threatened. Unless thwarted by legal challenges, the final rule is set to take effect on September 4, 2024.

There’s no doubt a federal noncompete ban would significantly affect relationships between employers and workers, but employers will have to wait to see if the already-filed and soon-to-be-filed legal challenges to the rule delay, limit, or prevent its implementation altogether. In the interim, what should you know about this ban, and what should you do in response?

How did we get here?