The FTC's New Plan for Non-Competes

In 2024, the FTC attempted to adopt a sweeping ban on all non-competes. It was blocked in federal courts in both Florida and Texas.

In September 2025, the FTC issued three separate actions over two days to outline its plans on addressing non-competes moving forward.

First, the FTC voluntarily dismissed its appeals in two cases that challenged its 2024 Final Rule. The vote to abandon was 3-1, and with this vote, the FTC’s rule is off the table.

Second, the FTC reached a settlement with a pet crematorium after alleging the company required all new hires to sign non-compete agreements, regardless of pay, job function, or location. The settlement prevents the company from using most non-competes, with exceptions for senior leaders or in the event of the sale of the business. The settlement will also limit customer non-solicitation clauses to clients the employee worked with in the past year.

Finally, the FTC issued a Request for Information asking the public to identify employers still using non-compete agreements. The RFI specifically highlights healthcare workers and even seeks further information on related restrictions, such as non-solicitation or non-recruitment clauses that limit employees’ future opportunities.

For employers, this means they can expect case-by-case enforcement from the FTC. The FTC has made it clear that it intends to use its authority to pursue employers that it sees as imposing "unfair or anticompetitive" restrictions.

Employers need to pay close attention to any restrictive covenants that they currently use. Not all restrictions are off-limits. The FTC recognizes that some non-compete agreements are valid.