Director, Global Employment Policy & Special Initiatives, U.S. Chamber of Commerce
The Federal Trade Commission (FTC) has proposed a new rule that would ban the use of noncompete agreements in the United States. As my colleague Sean Heather has written, the proposed ban isn’t rooted in any authority granted to the agency by Congress. And, if allowed to go into effect, will be the bedrock upon which the FTC will write additional competition rules to micromanage the U.S. economy. For its part, the FTC claims that eliminating noncompetes will improve worker mobility.
But what are businesses saying about how it would impact hiring? We conducted a survey to find out.
In our survey, we found that 80% of our respondents utilize restrictive covenants – including noncompete agreements – but 62% said that less than 10% of their U.S. workforce is subject to noncompete restrictions. Furthermore, we found that 78% of employers who responded offer additional compensation that covers the span of the noncompete duration or longer. As such, an appropriate exchange exists where businesses ensure their sensitive information is safeguarded while providing financial support to former employees.
We asked participants how many times an employee subject to a noncompete agreement was able to join a competitor based on a successful negotiation between the employer and employee or competitor. The answer? Nearly half of the respondents have successfully reached a...
Welcome to a new season of Everything Compliance—Shout Outs and Rants. We have a new host, Adam Turteltaub, and a new panelist, Rebecca Walker, joining returning regulars Matt Kelly, Jonathan Armst...