The Federal Trade Commission Dropped Its Noncompete Ban. Your Agreements Still Aren’t Safe.
Bottom line: The nationwide ban is off, but the enforcement risk just moved from one big rule to many targeted actions. If you rely on noncompetes in Massachusetts, New York, or Florida, you still need to pay attention.
What changed
On September 5, 2025, the FTC withdrew its appeals after federal courts in Texas and Florida held the 2024 noncompete rule unlawful. Instead of trying to revive a blanket ban, the FTC says it will police noncompetes case by case under Section 5 of the FTC Act (unfair methods of competition). Within days, the agency paired that message with outreach to employers, especially in health care, and set a public workshop for early October. The fight has now moved from rulemaking to enforcement. Case-by-case enforcement means surprise investigations, quick settlements, and headlines—exactly the kind of drip-drip pressure that catches companies flat-footed.
The litigation backdrop you should know
Texas and Florida rulings cut down the 2024 rule on authority grounds, prompting the FTC to step back from appeals.
What to expect now: expect aggressive, targeted scrutiny, not a universal ban.
The state-law patchwork didn’t go away
Even without a federal ban, state law drives most outcomes:
Massachusetts: noncompetes are allowed but constrained (e.g., garden-leave or similar consideration, notice, and carve-outs).
New York: a broad ban stalled in 2024, but courts already view overbroad restraints skeptically.
Florida: statutes favor enforcement of reasonable restraints tied to legitimate business interests, but 11th Circuit is where one of the FTC appeals sat—expect regional attention.
What the FTC will likely target next
Reading the agency’s own signals and recent alerts:
Low- and mid-wage workers where restraints look coercive.
Health-care roles (nurses, physicians, staffing) where local access and wages are sensitive.
Overbroad templates—agreements that reach far beyond trade secrets or client goodwill.
What to do now
Audit your templates
Strip out reflexive noncompetes for roles that don’t touch confidential strategy or client relationships. Narrow duration, geography, and scope. Convert many restraints to non-solicit and confidentiality protections.Shore up your trade-secret program
Courts and enforcers look for the basics: access controls, need-to-know policies, exit interviews, device returns, and real-world training. If you can’t show those, a noncompete won’t save you.Calibrate by state
Massachusetts: confirm compliance with consideration and notice rules; fix any “set-and-forget” language.
New York: lean on non-solicits and NDAs; keep noncompetes short and tightly tailored if you use them at all.
Florida: document the legitimate business interests (trade secrets, substantial relationships, customer goodwill) before you ask for a restraint. Judges expect that record.
Prepare for inquiries
Designate a response team (legal + HR). Keep a short memo ready that explains your business justification for each category of restraint. If you’re in health care, expect to be challenged.Update your offer-letter flow
Require role-based approval for any noncompete. Track usage metrics by department and seniority. If the data shows overuse, fix it.
A quick word for employees
If you’re moving jobs in MA, NY, or FL, don’t assume the ban saved you. The agreement you signed might still be enforceable. Have counsel review before you resign or download anything.
What we’re watching next
Whether FTC brings early settlements in health care, then expands to other sectors.
State-level reforms and salary thresholds that effectively ban noncompetes for most workers.
Spillover from broader Supreme Court moves curbing federal agency power, which shape how far the FTC can go without a rule.
FAQs: Noncompetes after the FTC’s pivot
Are noncompetes “legal” again?
Some are. Courts knocked out the FTC’s blanket ban. You still face state limits and targeted FTC enforcement. Treat every noncompete as high risk, not dead.
Does the FTC still care?
Yes. The focus shifted to case-by-case enforcement. Expect investigations where agreements look coercive or overbroad, especially in health care and lower-wage roles.
How long is “reasonable” for a noncompete?
Keep it short. Six to twelve months is the outer edge in many disputes. Shorter is safer unless you can show real risk and legitimate interests.
Do I need a noncompete for every role?
No. Reserve it for roles with real access to strategy, pricing, client relationships, or trade secrets. Everyone else should get a non-solicit and NDA.
What’s the difference between a noncompete and a non-solicit?
A noncompete blocks working for a competitor. A non-solicit blocks poaching clients or staff. Courts favor non-solicits when tailored to actual relationships.
What makes an agreement “overbroad”?
Blanket industry bans, nationwide scopes for local jobs, or restrictions unrelated to what the employee actually did. If you cannot explain the tie to a legitimate interest, it’s overbroad.
How do Massachusetts rules change this?
MA requires advance notice and real consideration, often garden leave or a similar payment. You also need carve-outs and a role-based rationale. Sloppy forms fail.
What about New York?
NY courts already distrust broad restraints. A proposed statewide ban stalled, but judges cut back on overreach. Lean on non-solicits and NDAs. If you use a noncompete, make it tight.
And Florida?
FL enforces reasonable restraints tied to “legitimate business interests.” Document those interests up front. Overreach still loses, and judges expect evidence.
What proof helps in court or with an investigator?
Access logs, confidentiality training records, exit interview notes, device return receipts, and a memo tying each restraint to trade secrets or customer goodwill.
We’re in health care. Anything special?
Yes. Expect scrutiny where restraints limit patient access or staffing. Keep restrictions narrow and focus on protecting referral sources and true secrets, not general skill.
How do we handle remote or multi-state employees?
Pick governing law and forum thoughtfully. Map where the employee lives and works. Train managers to avoid off-the-cuff promises that undercut the contract.
What if an employee already left with data?
Move fast. Lock accounts, preserve evidence, send a targeted hold letter, and audit downloads. File a narrow action focused on trade secrets and non-solicit relief if needed.
As an employee, can I ignore my noncompete now?
No. Get counsel to review before you resign or copy anything. Many agreements still bite, especially in Florida or for senior roles.
