FTC and DOJ Host Workshop on Non-Competition Agreements – Antitrust / Competition Law


United States: FTC and DOJ hold workshop on non-compete agreements

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As we reported last summer, President Biden signed a Executive Decree titled “Promoting Competition in the US Economy”. At the time, President Biden urged the chairman of the Federal Trade Commission (the “FTC”) to “restrict the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit the mobility of workers. workers “. Since the Order’s publication, speculation and uncertainty has swirled around what the Biden administration intends to do with regard to curtailing non-compete agreements.

As part of the Biden administration’s heightened scrutiny in this area, on December 6 and 7, the FTC and the Department of Justice (the “DOJ”) organized a two-day workshop titled “Making Competition Work: Promoting Competition in Labor Markets” with the aim of “exploring[ing] recent developments at the intersection of antitrust and labor laws, as well as implications for efforts to protect and empower workers through competition enforcement and rule-making. “

In opening remarks, representatives from the FTC and DOJ’s antitrust division focused on what is perceived to be a lack of competition in labor markets, which can have negative effects on workers. These representatives echoed President Biden’s stated goal of pursuing conduct that undermines competition in the labor market through criminal and civil prosecution. It should be noted that Lina Khan, President of the FTC, described the agency’s specific objectives for the FTC, including the scrutiny of non-compete and non-disclosure provisions in employment contracts through making and enforcing rules; or putting companies into unfair or deceptive practices that can harm their workers “on notice.” The opening speech by Tim Wu, special adviser to the president, however, did not mention non-competition agreements, and instead focused on the administration’s other commitments to promote competition in the fuel market. job.

Although the workshop ended without any firm direction on the president’s or agency’s plans, a number of panelists called on the FTC and DOJ to follow the lead of states and limit the use of non- competition in labor agreements, especially among low-paid workers. Notably, however, these calls were not firmly echoed by members of the administration, who appeared to be focused on other measures, such as regulating the misclassification of workers. However, what is clear from the panelists’ remarks and questions from FTC and DOJ lawyers and economists is that, at a minimum, rethinking the impact of non-competition agreements on competition in the labor market remains a top priority for the Biden administration.

FTC and DOJ hold workshop on non-compete agreements

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