Farm Action applauds the Federal Trade Commission (FTC) for issuing a proposed rule to prohibit employers from binding their workers with noncompete clauses. By accurately declaring that noncompetes are an unfair method of competition, the rule would force employers to withdraw existing agreements with their workers and prevent them from issuing new ones in the future.
Farm Action has long advocated for such a rule, which removes a key mechanism of exploitation and corporate control over U.S. workers.
“Noncompete clauses are essentially traps that enable corporations to hold workers hostage and entrench their monopsony power,” said Joseph Van Wye, Policy and Outreach Director for Farm Action. “Denied the freedom to seek other employment, workers are more vulnerable to the whims of their employers, subjecting them to low wages and unsafe working conditions. Today, FTC has made a bold stance of support for America’s workers — one we have sought for a long time.”
In sectors across the U.S. economy, one in five workers from all economic brackets — from fast food employees of McDonald’s to highly trained healthcare professionals — are constrained by noncompete agreements. The FTC states the benefits of this action include “[increased] wages by nearly $300 billion per year and [expanded] career opportunities for about 30 million Americans.”
A ban on noncompetes was explicitly called for in President Biden’s Executive Order on Promoting Competition in the American Economy, as it will make labor markets fairer and more competitive, as well as open up more opportunities for innovation and entrepreneurship.
Farm Action will engage with the FTC’s public comment period on the proposed rule.
Media Contact: Dee Laninga, firstname.lastname@example.org, 202-450-0094