Non-Compete Clause Rule

Document Headings Document headings vary by document type but may contain the following: the agency or agencies that issued and signed a document the number of the CFR title and the number of each part the document amends, proposes to amend, or is directly related to the agency docket number / agency internal file number the RIN which identifies each regulatory action listed in the Unified Agenda of Federal Regulatory and Deregulatory Actions See the Document Drafting Handbook for more details. Federal Trade Commission 16 CFR Parts 910 and 912 RIN 3084-AB74 AGENCY: Federal Trade Commission. ACTION: Final rule. SUMMARY: Pursuant to the Federal Trade Commission Act (“FTC Act”), the Federal Trade Commission (“Commission”) is issuing the Non-Compete Clause Rule (“the final rule”). The final rule provides that it is an unfair method of competition for persons to, among other things, enter into non-compete clauses (“non-competes”) with workers on or after the final rule's effective date. With respect to existing non-competes— i.e., non-competes entered into before the effective date—the final rule adopts a different approach for senior executives than for other workers. For senior executives, existing non-competes can remain in force, while existing non-competes with other workers are not enforceable after the effective date. DATES: The final rule is effective September 4, 2024. FOR FURTHER INFORMATION CONTACT: Benjamin Cady or Karuna Patel, Office of Policy Planning, 202-326-2939 (Cady), 202-326-2510 (Patel), Federal Trade Commission, 600 Pennsylvania Avenue NW, Mail Stop CC-6316, Washington, DC 20580. SUPPLEMENTARY INFORMATION: I. Background A. Summary of the Final Rule's Provisions The Commission proposed the Non-Compete Clause Rule on January 19, 2023 pursuant to sections 5 and 6(g) of the FTC Act. [ 1 ] Based on the Commission's expertise and after careful review and consideration of the entire rulemaking re…