The Federal Trade Commission has taken legal action against three companies and two individuals, forcing them to drop noncompete restrictions that they imposed on thousands of workers. Drawing from the FTC’s substantial expertise in this space, these actions mark the first time that the agency has sued to halt unlawful noncompete restrictions.

According to the complaints issued by the FTC, each of the companies and individuals illegally imposed noncompete restrictions on workers in positions ranging from low-wage security guards to manufacturing workers to engineers that barred them from seeking or accepting work with another employer or operating a competing business after they left the companies.

“These cases highlight how noncompetes can block workers from securing higher wages and prevent businesses from being able to compete,” said Chair Lina M. Khan. “I’m grateful to our talented staff for their efforts to vigorously enforce the law to protect workers and fair competition.”

“The FTC is committed to ensuring that workers have the freedom to seek higher wages and better working conditions without unfair restrictions by employers,” said Rahul Rao, Deputy Director of the FTC’s Bureau of Competition. “The FTC will continue to investigate, and where appropriate challenge, noncompete restrictions and other restrictive contractual terms that harm workers and competition.”

Noncompete restrictions harm both workers and competing businesses. For workers, noncompete restrictions...

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