Many employers experienced whiplash in 2023 from the flurry of judicial, administrative and legislative activity aimed at restricting the use of employee non-competition, non-solicitation, and non-disclosure agreements. Can you still require your employees to sign a non-compete agreement? What about requiring your employees to assign their inventions to your business? What updates to your agreement templates are required to ensure compliance with the latest changes in your jurisdiction? We summarize the relevant legal changes below, forecast what employers can expect in 2024 (spoiler alert – expect even more change), and offer practical tips for how best to comply in the ever-changing landscape of employee restrictive covenants.
Federal Updates
Actions by the Federal Trade Commission and the National Labor Relations Board
The Federal Trade Commission (FTC) set the tone for 2023 by proposing a new rule to ban employers nationwide from using non-compete agreements with their employees and independent contractors, estimating that such a prohibition would increase wages by nearly $300 billion annually and expand career opportunities for over 30 million Americans. The FTC received over 27,000 comments during the public comment period earlier this year. Since then, it has taken no further action.
The FTC was not the only federal agency working to ban employment-based non-competes in 2023. The General Counsel of the National Labor Relations Board (NLRB) issued a memo in March...
The President of the Association of Yorubas in Diaspora, South Africa, Dr Olusola Agbeniyi, has asked the senator representing Edo North, Adams Oshiomhole, to desist from making what he described ...