FTC ban on worker noncompete agreements blocked by federal judge

An estimated 30 cardinal Americans are employed with noncompete agreements.

A sweeping national prohibition connected noncompete agreements -- which was acceptable to instrumentality effect for tens of millions of Americans nationwide connected Sept. 4 -- is present permanently connected hold.

In a ruling Tuesday, a national justice successful Texas upheld a situation to the FTC's regularisation banning noncompetes, saying the authorities bureau lacks the authorization to enactment the prohibition successful place.

An estimated 30 cardinal Americans -- 1 retired of each 5 workers -- are employed with noncompete agreements successful industries ranging from tech to accelerated food. The FTC argues the agreements stifle workers' quality to power jobs and gain higher wages.

The FTC regularisation would person meant that anyone applying for a caller occupation could not beryllium forced to motion a noncompete. For workers with existing agreements, noncompetes would nary longer beryllium enforceable.

The determination from U.S. District Judge Ada Brown means those changes are efficaciously blocked.

In a connection to ABC News, FTC spokesperson Victoria Graham said the bureau is "seriously considering a imaginable appeal" of the decision.

"We are disappointed by Judge Brown's determination and volition support warring to halt noncompetes that restrict the economical liberty of hardworking Americans, hamper economical growth, bounds innovation, and depress wages," Graham said.

The suit was filed by the U.S. Chamber of Commerce on with a Texas taxation firm, which argued that the regularisation was excessively wide and that the FTC overstepped its authority.

"This determination is simply a important triumph successful the Chamber's combat against authorities micromanagement of concern decisions. A sweeping prohibition of noncompete agreements by the FTC was an unlawful hold of powerfulness that would person enactment American workers, businesses, and our system astatine a competitory disadvantage," U.S. Chamber of Commerce President and CEO Suzanne Clark said successful a statement.