Manufacturing Success, Episode #2: The FTC’s Massive Step Toward Limiting Restrictive Covenants

On January 5th 2023, the FTC took historic action ostensibly aimed at stamping out the “unfair” use of non-complete clauses in employment contracts. The proposed rule is broad and sweeping, with thousands of employers and millions of employees set to be impacted if it takes effect. For now, the FTC’s efforts can be characterized as “throwing the baby out with the bath water.” But there is a long way to go, and a lot to consider before allowing panic to set it. In this episode of Manufacturing Success, host Mike Carrouth talks with Michael Elkon, co-chair of Fisher Phillips Employee Defection and Trade Secrets practice group, about the proposed rule; how we got here, what happens next, and practical suggestions employers may want to consider while the FTC’s proposed seismic change to business practices moves forward. For more information on the FTC’s proposed rule change, please reference Fisher Phillips’ recently published Insights on the issue:

• FTC Proposes the End of Employment-Based Non-Compete Agreements
• Frequently Asked Questions About the FTC’s Proposal to Ban Non-Compete Agreements