Federal regulators have enacted a nationwide ban on new and current noncompete agreements. The Federal Trade Commission (FTC) voted 3-to-2 to approve the new regulation, which will ban noncompete agreements for all workers when the regulation takes effect August 21, 2024.

This potentially represents a large shift in the mindset of the employees and / or the general workforce as it relates to this common practice. It was simply defined and utilized to protect corporate proprietary information, trades, client bases and internal workings; but for employees and personnel that work within a specific industry and successfully rose through the ranks, it represented corporate overreach to control their career path, earning potential and ability to better themselves.

An estimated 30 million people, or one in five U.S. workers, are bound by noncompete restrictions, according to the FTC.  The new rule could boost worker wages by a total of nearly $300 billion a year, according to the agency.

This change puts more pressure on businesses to keep focused on their most important asset, employees. It is a great time to reevaluate internal employee practices perhaps leveraging employee recognition programs, creating flexible environments, promoting career development and overall, ensure you have a positive work culture.

In a time of do more with less, IQ Wired can be a strategic partner to augment or assist with some of these evaluations and changes. We can assist with offloading redundant tasks from employees, freeing up their time for wider more strategic contribution to the organization. This ruling is a macro force, but as a business, you have the opportunity to capitalize and keep your top employees in place for years ahead.