Contract Law- FTC’S Non-Compete Ban: The Uncertain Road Ahead for Employers and Employees Amidst a Circuit Split

Authored by Ben Parker

Abstract

This article discussed the FTC’s recently issued rule banning non-compete clauses in most employer-employee contracts, arguing that such provisions are unfair methods of competition under the FTC Act. However, this rule has faced legal challenges leading to differing rulings across federal district courts in Texas, Florida, and Pennsylvania. The Texas court blocked the rule, Florida limited its application, and Pennsylvania allowed it to proceed—though the case there was voluntarily dismissed by the Plaintiffs. With the FTC appealing adverse rulings and citing benefits like increased innovation and worker mobility, the matter may ultimately be resolved by the Supreme Court. Recent decisions like Loper Bright could also influence how courts will interpret the act going forward.