The FTC Just Banned Noncompete Agreements And It's A Huge Deal

The FTC’s three Democratic members were in favor of adopting the regulation, while its two Republican members were against it.

…

“The FTC estimated that the ban would boost wages by between $400 billion and $488 billion over 10 years.”

Employers are required to tell people that existing noncompetes are void:

The new rule makes it illegal for employers to include the agreements in employment contracts and requires companies with active noncompete agreements to inform workers that they are void. The agency received more than 26,000 comments about the rule after it was proposed some 16 months ago. The rule will take effect after 120 days, although business groups have promised to challenge it in court, which could delay implementation.

New York Times coverage for comparison

quindraco,

Well, naturally. Noncompetes are anti-capitalist and Republicans hate capitalism.

Xtallll,
@Xtallll@lemmy.blahaj.zone avatar

The Jimmy John’s noncompete barred workers from taking a job at a competing business within two years of leaving. It defined a competitor as any business that is located within 3 miles of a Jimmy John’s and derives at least 10% of its revenue from “submarine, hero-type, deli-style, pita and/or wrapped or rolled sandwiches.”

Wouldn’t want Subway to steal those sandwich secrets.

AuntieFreeze,

Especially since they are owned by the same VC.

nonfuinoncuro,

but what about hoagies?

Xtallll,
@Xtallll@lemmy.blahaj.zone avatar

You go to Hoagie Country, you take your life in your own hands.

InternetUser2012,

Lol, the two republiclowns voted no… BUT they’re looking out for ya right? Idiots.

11111one11111,

Wait, the entirety of the FTC is 5 fucking people?

FlowVoid,

The FTC has about 1000 employees, including five commissioners.

Crashumbc,

The controlling board, yes. How many does it take to sign off on final rules?

FYI the FTC has tens of thousands of employees.

silence7,

The commission which sets policy is five people. The FTC as a whole has over 1000 staff

Riven, (edited )
@Riven@lemmy.dbzer0.com avatar

Is that similar to our Supreme Court? Could conservatives stack that court and just destroy everything?

silence7,

FTC commissioners have a limited term of office, and no more than 3 are allowed to be members of one party.

A future Republican President could in fact change this by appointing a Republican majority. This makes it incredibly important to not allow that. That means not just planning to vote, but checking your registration to make sure it hasn’t been purged or in need of an update because you moved or changed names, volunteering and donating

11111one11111,

Government ran entities are the bane of my existence but the FTC has always been a seemingly efficient and unbiased regulatory commission. They’re fucked when it comes to regulating the tech industry but still less fucked than anyother boomer politician who vote on its laws.

I am a kid with the popcorn bucket entranced by the current and looming topic of intellectual property arguments. People rarely appreciate how fucking wild wild west the internet (even now) really is. Fuckin crawlers, scrapers, AI training all this shit is the smoke and tremors before Mt. St. Helen’s.

You cant but a pack of gum anymore without agreeing to terms and conditions while at the same time its all but common knowledge none of them hold a lick of value in a court room.

The best part is normally in life you can have a decent gut feeling the way something will play out. But with this I have no fuckkng clue.

I mean aren’t half the regulations around spamming emails covered by the FCC while the other half is FTC. Like think about this for a second. We live in 2024 where the internet is connected to implanted medical devices, it’s tracking your driving habits, listening to you jerk off, storing every text message you ever sent, then backing up that plus every picture you ever took but surprisingly do not actually own all because it never leaves the apple servers…etc the point being how in the flying fuck is the there not a single regulatory committee over seeing the internet? IDK maybe it’s because they would have to have open discussion about the very real very terrifying backdoor policy to software. Can’t drop terabytes if child porn on you nemises’ hard drive with out that little loophole in the system.

timewarp,
@timewarp@lemmy.world avatar

Now do arbitration agreements in employment contracts. Good luck arguing that the employer is still enforcing non-competes, when you have to do it in confidentiality through an arbitration provider your employer has already pre-selected.

Buddahriffic,

Do NDAs used to cover up illegal shit, too. Settlements shouldn’t be able to include anything to make the settlement or circumstances around it secret. It just enables them to continue doing what they were doing to others.

FlowVoid,

An NDA cannot be used to stop you from reporting a crime to the police or filing a lawsuit.

Buddahriffic,

Yes, but it can be used to prevent you from informing other people being exploited by the other party about how you fought them and how it worked out for you. In theory anyways, I’m not aware of any cases where such an NDA was breached and a lawsuit resulted. The Streisand effect might actually prevent some companies from following through and they hope the presence of the NDA is enough of a deterrent. Or maybe the courts are liberal with gag orders about such cases.

FlowVoid,

If other people are being exploited, they need a lawyer. A lawyer will have much better advice than you on how to fight back.

If you know other people are being exploited, nothing stops you from suggesting they get a lawyer. And if you have relevant evidence, a lawyer can subpoena it even if it’s under NDA.

timewarp,
@timewarp@lemmy.world avatar

LOL. “Excuse me sir. It looks like you’re about to be homeless. You could really use a lawyer right now. Why don’t you come up with 20k for a retainer instead?”

FlowVoid,

If you are about to become homeless, then you really need a lawyer. It’s not like someone under an NDA knows the One Weird Trick that will let you keep your home.

timewarp,
@timewarp@lemmy.world avatar

Actually, in many cases courts have permitted employers to compel arbitration even against civil RICO claims.

FlowVoid,

That has nothing to do with an NDA. An NDA limits what you can say, an arbitration agreement limits how you can pursue a civil claim.

FlowVoid,

Arbitrators can’t issue injunctions (ie they can’t order you not to work somewhere), so they don’t really have any way to enforce a non-compete.

timewarp,
@timewarp@lemmy.world avatar

You’re missing the point. Getting a court to review an arbitrator’s decisions can be extremely challenging. And actually arbitrators can issue injunctions in many cases. What your’e thinking of is likely if they can compel arbitration themselves on an injunction you file in court.

FlowVoid, (edited )

No, arbitrators cannot issue injunctions. They simply determine the size of an award, ie the amount of money that one side ought to pay the other. They can’t even force the losing side to actually pay the award.

That’s why arbitration decisions always end up before an actual court. Because it’s a judge, not an arbitrator, who can actually enforce payment. The judge won’t relitigate the entire case, but they will read the decision and have an opportunity to modify or throw out the award before it can be enforced.

foggy,

Brb, poaching all my asshole former employers clients.

HubertManne,
HubertManne avatar

I assume the clients were getting royally fucked to be so poachable.

foggy,

Well welcome to web development support. It ain’t worth $200/mo

bitchkat,

Or the few good employees they have.

foggy,

Only once I can’t handle it myself

xmunk,

Good old Republicans, unable to even look like they give a shit about common employees.

DragonTypeWyvern,

This isn’t even common employees, C- levels hate this too. Republicans and just being miserable bastards to everyone, name a better combo.

nilloc,

Boards don’t like it though. They’d rather spend $100 million (maybe way less though, politicians are cheap) to fight to save $400 billion in the long run.

CosmicCleric, (edited )
@CosmicCleric@lemmy.world avatar

From the article…

The FTC’s three Democratic members were in favor of adopting the regulation, while its two Republican members were against it.

… and …

The FTC’s rule does not include a salary threshold, but it has an exception for noncompetes when a business is sold.

The final rule also allows existing non-competes to be enforced for senior executives. But all other such contracts would be rendered unenforceable when the rule is implemented

https://creativecommons.org/licenses/by-nc-sa/4.0/legalcode.en

Olgratin_Magmatoe,

“bOTh sIdeS ArE thE sAmE”

silence7,

That exception is very much like the one in California, where the founders of a startup can be required to sign a noncompete when they sell it. Has essentially no material impact on anybody else.

CosmicCleric, (edited )
@CosmicCleric@lemmy.world avatar

Yeah it looks like they’re trying to preserve somewhat of the non-complete clause viability for senior management especially when companies are bought and sold.

https://creativecommons.org/licenses/by-nc-sa/4.0/legalcode.en

themoonisacheese,
@themoonisacheese@sh.itjust.works avatar

I mean, this makes sense and is what a non-compete is for in the first place.

CosmicCleric, (edited )
@CosmicCleric@lemmy.world avatar

I mean, this makes sense and is what a non-compete is for in the first place.

The issue has been that lately corporations have been using it on everyone, not just senior management, to control their movement, and not have to pay them as much, as there’s less competition from movement.

Though personally I don’t think it should be used for anyone, as we need to allow as much competition as possible, so that we all can earn greater income through better salaries.

https://creativecommons.org/licenses/by-nc-sa/4.0/legalcode.en

SaltySalamander,

It isn't just corporations. I work for a less-than-10 employee company, and I had to sign a non-compete. Couple friends that I used to work with now work for another company that's even smaller, and they had to sign one as well.

Passerby6497,

Yeah, I, a lowly button pusher, had to sign a noncompete at my first real gig close to a decade ago. It was at least limited to working on shared clients at another employer, but it was still really annoying considering nothing I knew about that customer’s ops that would have been considered proprietary.

bitchkat,

The FTC website says it has an exception for Senior Executives which it defines as people making over 151k and are involved in policy making decisions.

HubertManne,
HubertManne avatar

jeez that is sorta low espcially for large metropolitan areas.

bitchkat,

Its the “policy making decisions” clause that saves us.

magnetosphere,
@magnetosphere@fedia.io avatar

Rhetorical question: why do bills like this include specific wage amounts when those amounts are bound to become obsolete? Why not make them a variable, like the percentage of the cost of living?

AA5B,

Oh shit that’s low. A lot of engineers in high cost of living areas are going to need to argue they don’t make policy decisions

bitchkat,

Or are all getting promoted to Senior Executive! But I think that’s a good clause to greatly restrict who it applies to.

Takumidesh,

Given that non-competes were already hard to enforce and engineers (or any staff role) can easily answer no to questions like “are you an executive?” I don’t think it’s going to be hard.

fidodo,

The FTC’s three Democratic members were in favor of adopting the regulation, while its two Republican members were against it.

Not surprising in the least. Of all the Republican hypocrisy their attitude towards workers using their value to increase their earnings is one of the worst. They claim that they support self reliance and building yourself up, but stuff like this shows that it’s clearly a lie. They support businesses maximizing their earnings by charging what the market will bear, but as soon as a worker tries to do the exact same thing they lose their God damn minds.

timewarp,
@timewarp@lemmy.world avatar

The Republicans would reinstate child labor and child marriage in a heartbeat if they could get away with it. In fact, they do get away with it in some of their states.

fidodo,

Reinstate? Both are still allowed in many Republican states and Republicans have been blocking any attempt to stop it.

HubertManne,
HubertManne avatar

free market bro. oh wait. not like that!

  • All
  • Subscribed
  • Moderated
  • Favorites
  • •
  • politics@lemmy.world
  • DreamBathrooms
  • magazineikmin
  • ethstaker
  • khanakhh
  • rosin
  • Youngstown
  • everett
  • slotface
  • ngwrru68w68
  • mdbf
  • GTA5RPClips
  • kavyap
  • thenastyranch
  • cisconetworking
  • JUstTest
  • cubers
  • Leos
  • InstantRegret
  • Durango
  • tacticalgear
  • tester
  • osvaldo12
  • normalnudes
  • anitta
  • modclub
  • megavids
  • provamag3
  • lostlight
  • All magazines
    •