New Jersey Lawyers BlogNon-Compete Agreements Would be Abolished Under New FTC Rule
New Jersey employment law has generally upheld non-compete (or non-competition) agreements provided they met certain requirements aimed at allowing employees to earn a living. Non-compete agreements have been much vilified by pro-employee groups, and much
supported by pro-employer groups. However, the United States Federal Trade Commission has issued a rule which would prohibit non-compete agreements. At least one lawsuit has been filed aiming to block the new regulation, and others are expected. So whether the rule will take effect, and if so in what form it will be allowed, is still an open question. However, employers and employees should be prepared, because unless an injunction is issued the rule will become effective in several months.
The Rule
The Rule, part of the United States Code of Federal Regulations, defines non-compete clauses as: