Bowing to pressure from labor unions, the Federal Trade Commission (FTC) has proposed ending noncompete agreements. The proposal would include not only new agreements, but also existing ones, and would even cover some practice sales, which could dramatically impact values. Fortunately, this radical change is subject to several legal challenges, making its future implementation problematic.

The FTC recently proposed a rule to prohibit employers from imposing non-compete restrictions on employees. The ban would make it illegal for companies to enter into new non-compete contracts with employees, or to continue to maintain such contracts if they are already in force. Moreover, it would require companies with active non-compete clauses to inform workers that they are now void and no longer enforceable.

Such agreements typically prevent employees from leaving your practice to join a competitor, or setting up a new practice within a limited period of