Judge partially blocks FTC noncompetes ban: What it means for workers [Video]

The future of a Federal Trade Commission ban on noncompete agreements, scheduled to take effect this fall, is unclear after a preliminary ruling from a federal court last week.

Nearly 1 in 5 Americans, an estimated 30 million people, are subject to a noncompete agreement, according to the FTC. The agreements prevent workers from taking a new job with competitors or starting a new business in the same industry.

The Biden administration first proposed banning noncompete agreements in January 2023. In response, the FTC received more than 26,000 comments, with 25,000 of them in favor of the rule.

Judge Ada Brown, a Trump-appointed federal judge in Texas, issued a preliminary order against the FTC ban last week in a lawsuit brought by Ryan LLC, a Dallas-based tax services firm. The firm uses noncompete agreements to keep competitors from hiring away its workers and to keep workers from poaching firm clients. Ryan argued the FTC overstepped its legal …