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FTC bans noncompete agreements for workers (www.washingtonpost.com)

submitted 6 months ago by scroll_responsibly@lemmy.sdf.org to c/usnews@beehaw.org

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[–] collapse_already@lemmy.ml 6 points 6 months ago

Prior to this, the restrictions on non-competes varied by jurisdiction. Many were similar to Texas:

Under Texas law noncompete agreements can be enforceable if:

The noncompete provision is part of an otherwise enforceable agreement.
The non-compete requirement is supported by valid consideration (consideration meaning something of value provided to the employee).
The non-compete requirement is reasonable in geographic scope, timeframe, and activities being restrained.

The factors were issues for a jury. Even with this change from the FTC, I expect companies will still be able to pursue prohibitively expensive litigation against former employees for things like theft of trade secrets. Even a bogus claim can cost many thousands of dollars to defend even if it is meritless.