Posted on 08/20/2024 8:41:42 PM PDT by CFW
A federal judge in Texas on Tuesday barred a US Federal Trade Commission rule from taking effect that would ban employers from requiring their workers to sign non-compete agreements.
The ban, which had been scheduled to go into effect nationwide on September 4, is now effectively blocked.
US District Judge Ada Brown in Dallas said the FTC does not have the authority to ban practices it deems unfair methods of competition by adopting broad rules.
“The Court concludes that the FTC lacks statutory authority to promulgate the Non-Compete Rule, and that the Rule is arbitrary and capricious. Thus, the FTC’s promulgation of the Rule is an unlawful agency action,” Brown wrote in her order. “(The rule) is hereby SET ASIDE and shall not be enforced or otherwise take effect on September 4, 2024, or thereafter.”
Brown had temporarily blocked the rule in July for a small number of employers while she considered a bid by the US Chamber of Commerce, the country’s largest business lobby, and tax service firm Ryan to strike it down entirely.
(Excerpt) Read more at cnn.com ...
Take your non-compete and shove it.
I’m with you on this. If someone declines to sign one, I am sure they can find work somewhere that won’t require it.
When I started working in a picture framing shop, I had to sign an non-compete document. Since the boss was taking a huge chance on me and training me from scratch, it was only fair that I didn’t take what I learned, as well as the pricing structure, and use it somewhere within her sales area or within the time set in the document.
Businesses should not be allowed to impose certain terms and conditions on their employees. "Non-compete" is one of those conditions.
The relationship between employer and employee is inherently unequal and businesses tend to do everything they can to impose "contracts of adhesion" unless curbed.
A free market in labor would fix such problems. Businesses tend to do everything they can do to prevent a free market in labor.
It is not that business executives are inherently bad. It is that the incentives and greatest profits go to the ones who are bad, unless they are restrained by laws and customs.
I am not in favor of this court ruling.
Hallelujah!!
In the engineering industry, it is very common.
Someone can work for one employer, do virtually nothing, but learn the trade secrets and just go and sell them to the competition.
This ruling has nothing to do with declaring non-compete rulings good, bad, or indifferent. It shuts down an unlawful action by a Federal agency that didn’t follow its own rules
For that reason this ruling is to be applauded. If Congress wants to ban non-compete agreements they can pass a law and send it to the President for his signature. But for a President to simply order it and command some faceless bureaucrats to write a rule for the entire nation flies in the face of the Constitution.
L
Precisely!
I am not sure that such a law would be Constitutional. Most workers work in only one state. This seems like this should be a state matter.
The politicized federal courts have gotten the populace used to the idea that results I agree with are correct rulings, and vice versa. This court properly found that the making of this rule was outside the agency’s powers. If you want this to be the law, lobby Congress to make it the law, rather than imposing it via the fiat of unelected bureaucrats
“ I am not sure that such a law would be Constitutional.”
Nor am I. But that’s not the point. This judge made a correct ruling on the supposed power of this Federal agency to simply write a rule and declare it enforceable for the entire country without even pretending to follow the law or its own rules.
L
“When I started working in a picture framing shop, I had to sign an non-compete document. Since the boss was taking a huge chance on me and training me from scratch, it was only fair that I didn’t take what I learned, as well as the pricing structure, and use it somewhere within her sales area or within the time set in the document.”
Exactly! It would certainly make companies tend to promote from within rather than taking a chance on unknown talent. A company would look at promoting long-known loyal employees rather than risk hiring someone who would take their work product and start a business that would undercut them.
I can accept that as a plausible reason to strike down an action of a government agency. But, of course, that is only part of the story. This was struck down primarily because business executives wanted it struck down and were able to shop for a favorable venue of jurisdiction to get the ruling they wanted.
The issue should be settled by Congress passing appropriate laws. And it is clear that Congress will never do such a thing. We have a system of "one dollar, one vote" which favors large corporations over small companies and individuals. It is not a good system.
I have in the past refused to work for companies which require non-compete agreements. I recommend that policy to others. That presumes there is still a free market for labor. It is a bad bet in the long run if corporations are permitted to follow their natural incentives.
I have to agree with you.
Markets should be free.
The ground should be level.
Whoops.
FTC rule certainly was not have been the right remedy. But non-compete clauses are blatantly an attack on economic freedom. There are times when they are certainly legit but a good many of them are just a way to keep a person from earning a living in a field they are qualified in.
Exactly, and how many Harris/Biden commie edicts have been struck down now? It has to be a record. Definitely more than the left’s lawfare during Trump’s term where many of them were finally supported by the court.
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