FTC’s Noncompete Ban Mirrors State Proposals Before Scaling Back

The Federal Trade Commission’s proposal to ban nearly all worker noncompetes follows years of legislation in statehouses, where lawmakers have a track record of walking back sweeping proposals to enact less-stringent noncompete limits that could prove a model for the agency’s final rule.

Policymakers such as those in the Massachusetts legislature and the D.C. Council have considered near-total bans on employee noncompete contracts. Those contracts, which researchers estimate cover roughly one-fifth of US workers, stipulate that employees won’t leave their job to go work for a competing business.

Like the FTC, state lawmakers have cited the negative effects the contracts ...