Advocacy Alert: FTC Proposed Ban on Non-Competes
February 15, 2023
Dear Yoga Alliance Community,
Yoga Alliance regularly monitors relevant legislation and proposed regulations that may impact the practice of yoga, the yoga community, and/or yoga business(s). We are alerting you of a new development regarding non-compete agreements:
Federal Trade Commission (FTC) has proposed a rule that would impose a nationwide ban on almost all non-compete agreements between employers and workers. If adopted, the rule would apply both prospectively and retroactively.
WHAT DO YOU NEED TO KNOW?
Non-compete agreements are already prohibited by law in California, Oklahoma, and North Dakota, and many states and localities place other restrictions on non-compete provisions, such as barring employers from enforcing non-competes against lower wage workers or limiting the permissible duration of a post-employment non-compete.
Across the US, approximately one in five American workers – roughly 30 million people – are subject to a non-compete provision or agreement. This proposed rule has implications for businesses across the entire country, including yoga and wellness businesses with full-time and/or part-time workers, with “workers” defined broadly to include employees, contractors, interns, consultants, and volunteers.
If this proposed FTC rule is adopted as a final regulation:
Would be free of non-compete obligations that limit job opportunities after departure from a current position
Would be required to rescind all
pre-existing and current non-compete agreements with their workers
WHAT EXACTLY DOES THIS MEAN?
- The proposed rule would not prohibit non-solicitation agreements that restrict a former employee from actively pursuing their former employer’s clients to follow them to a new place of employment (although state law prohibitions on such agreements, as in California, would still apply).
- The proposed rule would also permit non-compete agreements in the narrow circumstances of restrictions on partners or owners of at least 25 percent of a business in connection with the sale of the business.
WHAT CAN YOU DO?
You can make your opinion heard. The FTC is seeking public comment on the proposed rule. Submit your comment here before March 20, 2023. And, we want to hear from you as well! Email us your thoughts at firstname.lastname@example.org with subject line: Proposed Non-Competes Ban.
WHAT IS YOGA ALLIANCE DOING?
Our goal is to support you and provide timely updates on important developments that may impact you. The Yoga Alliance Advocacy team works with legislative and regulatory counselors from Pillsbury Winthrop Shaw Pittman, LLC on issues important to the yoga community, including steps our association should take, such as submitting a public comment related to this proposed rule. They are also helping us assess the implications of this rule on both Registered Yoga Teachers and Registered Yoga Schools (RYSs). We invite you to join us for a digital event with Pillsbury representatives to learn more and have your questions answered.
How the FTC’s Proposed Ban on Non-Compete Agreements May Affect You and Your Yoga Business
Thursday, February 23 at 1pm ET
Thank you for all that you do for your communities.