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Business groups want more time to consider FTC’s noncompete rule

By:
Reuters
Updated: Jan 31, 2023, 22:21 UTC

WASHINGTON (Reuters) - The U.S. Chamber of Commerce, which has indicated that it would oppose a broad rule banning most noncompete agreements for employees, asked the Federal Trade Commission Tuesday to extend the comment period for the rule.

Signage is seen at the Federal Trade Commission headquarters in Washington, D.C.

WASHINGTON (Reuters) – The U.S. Chamber of Commerce, which has indicated that it would oppose a broad rule banning most noncompete agreements for employees, asked the Federal Trade Commission Tuesday to extend the comment period for the rule.

In a letter to the FTC signed by the Chamber and some 100 organizations like the American Hotel and Lodging Association, the groups argued that the rule was broad enough to warrant an in-depth look.

“The regulated community should be given sufficient time to assess the potential consequences of the rulemaking and develop insightful comments for the Commission to consider,” they wrote.

They asked for the comment period to be extended by 60 days.

The FTC proposed the rule on Jan 5. It would require companies with existing noncompete agreements to scrap them. It would also stop companies from requiring workers to reimburse them for some kinds of training if they leave before a certain period of time, a strategy some companies began using when noncompete provisions garnered tougher scrutiny.

The FTC, which has already received more than 5,000 comments on the proposed rule, has said that the comment period would be open through March 10.

Critics of noncompetes say that the arrangements, which they say affect nearly one-fifth of U.S. workers, dampen wages by making it harder for some workers to change jobs or start new businesses to compete with their old bosses.

The FTC declined to comment on the request.

(Reporting by Diane Bartz; editing by Jonathan Oatis)

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