Employers should note that the Federal Trade Commission (FTC) is continuing to take enforcement action against some employer use of non-compete provisions despite the repeal of regulations issued during the Biden administration.
In April of 2024, the Biden FTC issued a Final Rule effectively banning the use of non-compete agreements in employment, independent contractor, and other relationships.
Additional information on the ban is available in our April 24, 2024 and April 26, 2024 Client Alerts, available on our website at the following links: FTC Issues Final Rule Banning Use of Non-Compete Agreements and Texas Court Blocks FTC’s Pending Ban on Non-Compete Agreements. Although the Biden-era regulations were repealed earlier this year, the Chair of the Trump FTC issued a statement in September of 2025 indicating that the FTC will continue to enforce antitrust laws aggressively against offending non-compete agreements – but providing limited guidance about how it will do so.
Under the Trump Administration, the FTC has thus far taken the following enforcement actions:
- On September 4, 2025, the FTC announced an enforcement action against Gateway Services, Inc. for a reported policy requiring all U.S. employees to sign a non-compete preventing them from working in pet cremation anywhere in the U.S. for 1 year after their employment ended.
- On February 12, 2026, the FTC announced an enforcement action involving Adamas Amenity Services, LLC, indicating that the company maintained no-hire agreements in customer contracts that required customers to refrain from hiring Adamas employees during the term of the contract, and a period after the contract ended, without paying a fee.
- On April 15, 2026, the FTC sent a Proposed Order to Rollins Inc., indicating that the company required all new employees, including low-wage employees to sign a non-compete preventing them from working in the pest control industry for two years within a (usually) 75-mile radius.
In addition, the FTC has sent warning letters to certain employers in the healthcare and pest control industries.
Although the FTC has yet to issue regulatory guidance indicating how it will evaluate enforcement actions moving forward, these cases appear to have two (2) things in common: non-compete provisions were applied to low-wage, often unskilled employees; and aggressive enforcement of the non-compete provisions against such employees.
Employers who utilize non-competes and other restrictive covenants should consider conducting regular self-assessments to ensure their agreements are narrowly tailored, include a reasonable time and scope, and that the use of non-compete agreements is limited to those employees whose exposure to confidential company information and trade secrets warrants the use of such provisions.
If you have any questions about how the FTC’s position on non-competes may affect your organization, please call our office. Thank you.
This Client Alert provides a general overview of new legal developments. It is not intended to
provide legal advice. If you have questions or would like more information about how these
developments may effect your business, please contact us at (570) 341-8800.
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