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Should Non-Compete Clauses Be Banned?

January 10, 2023

The Federal Trade Commission (FTC) has proposed a rule prohibiting non-compete clauses. If enacted, U.S. workers would have more choice about what jobs – and salaries – they accept. They could more easily take positions aligning with their current skills, work for rival companies, or start their own companies with less fear of being sued by former employers. 

The FTC estimates the proposed rule could increase wages by $300 billion a year and impact 30 million Americans. It’s believed that as many as 50 percent of people in high-skilled and high-tech jobs have non-compete clauses in their contracts. The proposed changes are supported by consumer and labor groups – and opposed by organizations representing business interests, including the U.S. Chamber of Commerce, which argue that noncompete clauses protect investment in employees and sensitive business information. Read more of the Vox story here.

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