The Federal Trade Commission (FTC) announced a notice of proposed rule making (NPRM) on January 5, 2023, that would ban employers from entering into and maintaining noncompete clauses with their workers. With this potential ability for workers to change jobs more freely, employers will become more focused on protecting their innovations by enforcing confidentiality clauses and trade secret laws. The proposal comes approximately 18 months after US President Joseph Biden called for the FTC to ban or limit clauses in employment contracts that restrict workers’ freedom to change jobs, and roughly 24 months after the FTC hosted a public workshop to consider whether there is a sufficient legal basis and empirical support to promulgate a rule restricting the use of noncompete clauses in
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