b'THE OFFICIAL NFBA MAGAZINEFTC BANS MOST NEW NONCOMPETE AGREEMENTS NATIONWIDEBUSINESS MANAGEMENTRULE MAKES ALL EXISTING NONCOMPETE AGREEMENTS EXCEPT FOR THOSE COVERING SENIOR EXECUTIVES UNENFORCEABLERoy Maurer, Online Manager/Editor, Talent Acquisition at SHRMT he U.S. Federal Trade Commission (FTC)Crook added that senior executives approved a proposed final rule banning mostasdefinedintheruleisan new noncompete clauses in employmentextremely limited population, which contractsa sweeping rule affecting millions ofthe FTC estimates to constitute workers. fewer than 0.75 percent of all workers.The rule also makes all existing noncompeteThe rule goes into effect 120 days following its agreements except for those covering seniorpublication in the Federal Register. Enforcement executives unenforceable and requires employerscould be further delayed by likely legal challenges. provide notice to current and former workers thatThe U.S. Chamber of Commerce has already their noncompete clauses are no longer in effect.pledged to sue the agency over the rule.The FTC defines the term senior executive to referThe rule defines noncompete clause to mean a to workers earning more than $151,164 annuallycontractual term that blocks a worker from working who are in a policy-making position. for a competing employer, or starting a competing The final rule reflects some changes from thebusiness, within a certain geographic area and original Notice of Proposed Rulemaking, but theperiod of time after the workers employment ends.substance is the same, said Jonathan Crook, anThe rule also applies in some cases to agreements attorney in the Charlotte, N.C., office of Fisherthat require employees to pay back the employer for Phillips. 8 / FRAME BUILDER - VOL5 2'