New federal rule would bar companies from forcing ‘noncompete’ agreements on employees

By CHRISTOPHER RUGABER
AP Economics Writer

WASHINGTON (AP) — U.S. companies would no longer be able to bar employees from taking jobs with competitors under a rule approved by a federal agency, though the rule is sure to be challenged in court. The Federal Trade Commission voted to ban measures known as noncompete agreements, which bar workers from jumping to or starting competing companies for a prescribed period of time. According to the FTC, 30 million people — roughly one in five workers — are now subject to such restrictions. The Biden administration has taken aim at noncompete measures, which are commonly associated with high-level executives at technology and financial companies but in recent years have also ensnared lower-paid workers, such as security guards and sandwich-shop employees.