


After the Federal Trade Commission voted to block new noncompete agreements for 30 million workers on Tuesday, business groups and the United States Chamber of Commerce have taken action.
A lawsuit was filed Wednesday by the Chamber of Commerce, Business Roundtable, Texas Association of Business, and the Longview Chamber of Commerce seeking to block the ban on noncompete agreements.
“These agreements benefit employers and workers alike—the employer protects its workforce investments and sensitive information, and the worker benefits from increased training, access to more information, and an opportunity to bargain for higher pay,” the plaintiffs wrote in the lawsuit.
“Although some Members of Congress have recently taken an interest in the issue and proposed legislation that would establish national rules for noncompete agreements, those proposals have never received a Committee vote, let alone a vote from either House of Congress. Without such authorizing legislation, federal agencies have not previously sought to play a role in regulating noncompete agreements on a nationwide basis,” the lawsuit adds.
A noncompete ban would allow 30 million people to change jobs within their industry and earn more money, according to the FTC. President Joe Biden previously expressed his support for the FTC’s actions.
Rep. Matt Gaetz (R-FL) applauded the FTC’s previous decision in a rare agreement with Biden’s administration in a post on X.
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“Yesterday, the United States Federal Trade Commission, under the leadership of Chairwoman Lina Khan, issued a final rule prohibiting most non-compete clauses nationwide.” Gaetz’s post read. “I applaud this move by the FTC as a vindication of economic freedom and free enterprise.”
The FTC’s rule was scheduled to go into effect 120 days after the decision, but legal challenges have now delayed that timeline.