On the heels of the FTC’s announcement of a proposed rule to ban all noncompetes, a bipartisan group of Senators has reintroduced the “Workforce Mobility Act.” The Act would ban the enforcement of most noncompetes, though it would not go as far as the rule proposed by the FTC. For example, under the proposed legislation:
- Owners or senior executives would be excluded from the ban, as long as the noncompetes were limited to specific geographic areas and no more than one year.
- Former partners in a business could also be subject to noncompetes with similar limitations.
- The FTC and DOL would be empowered to investigate and prosecute employers who attempt to enforce noncompetes that are not within any of the exceptions.
Whether the momentum and/or backlash from the proposed FTC rule will cause this Act to get more serious consideration in Congress is yet to be seen. We will keep an eye on it and update these posts as developments occur. In the meanwhile, please let us know if we can help.