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Attorneys general coalition to FTC: Limit use of noncompete clauses in employment contracts

November 21, 2019

By Kimber Solana

A coalition of 19 attorneys general is asking the Federal Trade Commission, in a Nov. 15 letter, to use its rulemaking authority to limit the use of noncompete clauses in employment contracts.
   
The coalition also claims that these clauses do damage to workers, consumers and businesses.
   
“Noncompete clauses in employment contracts prevent employees of one business from leaving and working for or starting another,” according to the letter from the coalition, which involves attorneys general of Minnesota, California, Delaware, District of Columbia, Illinois, Iowa, Maine, Massachusetts, Maryland, Michigan, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington and Wisconsin.
   
“Using noncompetes, employers have bound a wide range of workers — including baristas, engineers, journalists, home health aides, physicians and sandwich makers — and deprived them of their freedom to use their labor as they choose,” the coalition stated.
   
According to the attorneys general’s letter, nearly 30 million American workers, or one in every five, have been bound by noncompete at some point during their careers.
   
In addition, noncompete clauses also burden businesses seeking to hire workers or enter a market, the coalition asserted in its letter.
   
“Since the FTC has the authority and duty to protect workers as well as consumers, it should act now to prevent another employer from robbing even one more worker of the right to leave for better opportunities,” the coalition said, adding it’s asking the FTC to provide an estimate for how long the rulemaking process will take and when they can expect proposed and final rules.
   
The ADA Center for Professional Success offers the free publication, “Dentist Employment Agreements: A Guide to Key Legal Provisions,” which explains many of the terms and provisions common to dental employment agreements, including what a noncompete clause is and why the clause is important in dentist employment agreements. To access the guide, visit Success.ADA.org.