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Federal Trade Commission Proposes Banning Non-Compete Agreements

The Federal Trade Commission (FTC) has recently proposed a rule that would federally ban all employer-worker non-compete agreements for all employees. It is important to note that this rule would prohibit previously established non-compete agreements as well. Non-compete agreements are contracts that can prevent an employee from working for their companies’ competitors during or after their employment.

The issue of non-compete agreements are currently handled at the state level. Here are the important criteria that must be met for a non-compete agreement to be enforceable in Washington state:

–The employee or independent contractor makes over $100,000 or $250,000, respectively.
–The agreement is entered into at the time of hiring
–The agreement has a time limit of 18 months

The FTC’s new rule, if adopted, could significantly impact employers across the Spokane area who have employees in any industry in the United States. Employers would no longer be able to use these agreements with their employees in any capacity.

There is a comment period, ending March 10, that allows for interested parties to voice their feedback to the FTC. If you feel this proposed rule may impact your business, please reach out to our Director of Public Policy, Jake Mayson, with assistance in writing a comment.

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