Official legislative records or announcements

Texas Judge Ada Brown Blocks FTC's Nationwide Noncompete Ban

Aug 21, 2024, 11:32 AM

A federal judge in Texas has blocked the Federal Trade Commission's (FTC) rule banning noncompete agreements, which was set to take effect on September 4, 2024. The decision was made by Judge Ada Brown, a Trump-appointed judge, who ruled that the FTC lacked the authority to implement such a regulation, calling it 'arbitrary and capricious.' This ruling has significant implications for the estimated 30 million American workers who are currently bound by noncompete clauses. The FTC's rule aimed to prohibit these agreements nationwide, arguing that they stifle competition and innovation in the labor market. The White House has expressed support for the FTC's efforts, emphasizing the potential benefits of the ban, including an estimated $200 billion increase in wages over the next decade. However, the court's decision means the rule will not be enforced, and the FTC is considering an appeal.