Benjamin Dryden Discusses Proposed Federal Ban on Noncompete Clauses

11 January 2023 CNBC News

Foley & Lardner LLP Partner Benjamin Dryden is quoted in the CNBC article, “Proposed ban on noncompete clauses could affect ‘every business in the country,’ says attorney — what that means for you,” discussing the impact of a rule put forward by the Federal Trade Commission (FTC) that would prohibit companies from requiring workers to sign noncompete clauses.

Dryden said the impact will be felt both by companies with employees who are governed by noncompetes as well as companies hiring workers currently bound by them. “This regulation will affect, more or less, every business in the country,” he explained.

Dryden recommended that companies take advantage of the FTC’s 60-day comment period to make clear their position on the rule. “If you think this will do harm to your legitimate business, submit comments to the FTC explaining your thoughts,” he noted.

Dryden explained that while “there was clearly momentum building toward this,” he “wouldn’t be surprised if the FTC ends up scaling back this regulation.”

As many states already limit noncompete agreements, Dryden said it is not unexpected that the federal government is testing a blanket ban.

“It’s too early for businesses to take any drastic action, but companies should be mindful that’s a real risk,” he added.