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FTC and DOJ Hold Workshop On Non-Compete Agreements

As we reported this past summer, President Biden signed an Executive Order titled “Promoting Competition in the American Economy.” At the time, President Biden urged the chair of the Federal Trade Commission (the “FTC”) to “curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility.” Since the Order’s publication, speculation and uncertainty have percolated around what the Biden Administration intends to do with regard to restricting non-compete agreements.

In connection with the Biden Administration’s increased scrutiny in this area, on December 6 and 7, the FTC and Department of Justice (the “DOJ”) held a two-day workshop titled “Making Competition Work: Promoting Competition in Labor Markets” with the goal of “explor[ing] recent developments at the intersection of antitrust and labor, as well as implications for efforts to protect and empower workers through competition enforcement and rulemaking.”

During the opening remarks, representatives of the FTC and DOJ Antitrust Division focused on what is perceived to be a lack of competition in the labor markets, which can have adverse impacts on workers. These representatives echoed President Biden’s stated goal of pursuing conduct that harms labor market competition through criminal and civil litigation. Of note, Lina Khan, FTC Chair, outlined specific agency goals for the FTC, including scrutinizing non-compete and non-disclosure provisions in employment agreements through the use of rulemaking and enforcement, or putting firms that allegedly conduct unfair or deceptive practices that may harm their workers “on notice.”  The keynote address given by Tim Wu, special advisor to the President, however, did not mention non-compete agreements, and focused instead on the Administration’s other commitments to promoting competition in the labor market.

Although the workshop ended without any firm guidance on the President’s or the agencies’ plans, a number of panelists called on the FTC and DOJ to follow the states’ leads and limit the use of non-competes in employment agreements, particularly among low-wage workers. Notably though, these calls were not firmly echoed by members of the Administration, who appeared focused on other measures, like regulating worker misclassification. However, what is clear from the panelists’ remarks and questions by FTC and DOJ attorneys and economists is that, at a minimum, re-thinking how non-compete agreements impact competition in the labor market remains a top priority of the Biden Administration.

© 2022 Proskauer Rose LLP. National Law Review, Volume XI, Number 348
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About this Author

Guy Brenner, Labor Attorney, Proskauer Rose, arbitration proceedings Lawyer
Partner

Guy Brenner is a partner in the Labor & Employment Law Department and co-head of the Non-Compete & Trade Secrets Group. He has extensive experience representing employers in both single-plaintiff and class action matters, as well as in arbitration proceedings. He also regularly assists federal government contractors with the many special employment-related compliance challenges they face.

Guy represents employers in all aspects of employment and labor litigation and counseling, with an emphasis on non-compete and trade secrets issues,...

202-416-6830
Daryl Leon, Proskauer Law Firm, Labor and Employment Litigation Attorney
Associate

Daryl Leon is an associate in the Labor & Employment Law Department and a member of the Firm's Employment Litigation & Arbitration Group.

Daryl has experience in managing all aspects of litigation, including taking and defending depositions, motion practice, oral arguments, and trials. His practice focuses on defending employers in state and federal court lawsuits and administrative agency proceedings against claims of discrimination, harassment, whistleblowing and retaliation, and violations of wage and hour laws. He has represented...

212-969-3262
Associate

Sydney Cone earned her J.D. from Tulane University Law School, where she was the Senior Online Editor of the Tulane Maritime Law Journal and co-president of Tulane Women in the Law.

Prior to law school, Sydney was a paralegal for Lankler, Siffert, and Wohl, LLP, focusing on white collar criminal and civil litigation.

504.310.3043
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