On April 23rd of this year, the Federal Trade Commission made an important ruling that appears to have flown mostly under the radar. In it, the FTC banned the use of noncompete agreements throughout the United States. Only existing policies for certain senior executives were excluded. The announcement can be found HERE:
This ruling has wide-reaching implications across the hiring spectrum, and some businesses began feeling the headwinds of opposition several years before. In 2016, “freaky-fast” sandwich chain Jimmy John’s settled lawsuits filed by Illinois and New York that accused the noncompete agreements they forced their workers to sign of being illegal. Before the settlement, if you worked at Jimmy John’s and got a better job offer from a Subway franchise, for example, you would be prohibited from taking the job. The court identified these agreements as predatory, as they worked to lock employees into their low-paying jobs while reducing chances at higher-paying employment from a competitor. (Read the article HERE)
It seems that no field was safe from the threat of noncompete agreements. I know someone who worked for a short time at a puzzle store in my hometown of St. Louis. They were forced to sign a noncompete agreement that prevented them from starting a puzzle store, for all practical intents, anywhere within the continental US. I didn’t know the puzzle business was that cutthroat!
Particularly in IT, noncompete agreements were used to prevent workers from moving on to a similar, better-paying position at another company. I once worked for an employer that wanted me to sign one almost four years into my time of employment. I had a legitimate emergency on the day I was to sign, and it was forgotten about until I left the company. They realized their mistake, and near the end of my two-week notice, they tried to compel me to sign. I declined.
For anyone in the IT field who has considered making a positive career change but felt threatened by the repercussions of “breaking” a noncompete agreement, you are no longer subject to the provisions. Time to celebrate!
Maybe with a big sandwich?
