On July 9, President Biden signed an executive order encouraging the Federal Trade Commission to ban or limit the use of non-compete agreements for private companies as well as the use of “unnecessary occupational licensing restrictions that impede economic mobility,” according to a White House fact sheet.

The provision is part of a directive to federal agencies that seeks to eliminate barriers to economic competition in a several of industries, including healthcare, transportation and internet service, among others. The White House said actions on non-competes would make it easier for workers to change jobs while raising wages.

The order also encourages FTC and the U.S. Department of Justice to strengthen antitrust guidance in order to “prevent employers from collaborating to suppress wages or reduce benefits by sharing wage and benefit information with one another.”

Employers who use non-compete agreements should seek legal counsel immediately in order to determine if there are any red flags that could eventually render the agreements null and void under any new action resulting from this Executive Order.

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