Federal Trade Commission Makes Highly Controversial Decision

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(PatriotNewsDaily.com) – On Tuesday, the Federal Trade Commission (FTC) in a 3-2 vote decided that noncompete agreements would be banned as they were blocking millions of employees from being able to switch to working from a competitor within a short period of leaving their job. 

The FTC estimates that around 18 percent of the U.S. workforce has had to sign noncompete agreements regardless of their position or industry. This has affected around 30 million people according to the estimates. 

The new rule is going to ban noncompete agreements from being placed on all workers and would require that all companies inform their workers that any existing such agreements would not be implemented. However, in a change to the original proposal, the noncompete agreements would still apply to senior executives in companies. 

In her remarks, FTC Commissioner Rebecca Slaughter (D) argued that it was “unfree and unfair” for people to be blocked from leaving a company not because they could not find any work but because noncompetes would block other firms from hiring them. This could also mean that oftentimes workers would require workers to either completely leave their industries or homes to survive a career change. 

The new rule is going to go into effect in 120 days following its publishing in the Federal Register. However, many businesses are going to be taking legal action to oppose the rule. As they have argued, the noncompete agreements are essential to protecting intellectual property and proprietary information. 

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