Federal Court Ruling Prohibits FTC Ruling on Non Compete Agreements From Going Into Effect | SCAI

On August 20th, 2024, a federal court in Texas issued a nationwide injunction that prohibits an FTC ruling that would have banned noncompete agreements across the US from going into effect. The rule was set to go into effect on September 4th. The federal court in Texas found that “the FTC exceeded its statutory authority when it adopted the Final Rule, and that the Final Rule itself was arbitrary and capricious.” Affirming its July temporary restraining order concerning the FTC administrative rule, the court stated that “the [FTC] has exceeded its statutory authority in promulgating the Non-Compete Rule.” Now that the FTC ruling has been overturned, there is a clear need for a legislative solution to this problem. Fortunately, a solution exists in the Workforce Mobility Act (H.R. 731S. 220).  

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