April 19, 2023

Senators Warren, Blumenthal and Representatives Jayapal, Kuster, Omar, Beyer and Dozens of Lawmakers Support FTC Proposed Rule to Limit Noncompete Agreements

“All Americans stand to benefit from a more dynamic and freer labor market that would accompany the promulgation of this rule.”

Text of Letter (PDF)

Washington, D.C. – U.S. Senators Elizabeth Warren (D-Mass.) and Richard Blumenthal (D-Conn.) and Representatives Pramila Jayapal (D-Wash.), Annie Kuster (D-N.H.), Ilhan Omar (D-Minn.), and Don Beyer (D-Va.) led over 60 of their colleagues in a letter to Federal Trade Commission (FTC) Chair Lina Khan, urging the agency to move forward with their proposed rule banning noncompete agreements to give approximately 30 million Americans the opportunity to change jobs and create new businesses.

In January 2022, the FTC proposed a rule to ban noncompete agreements, but has faced aggressive pushback from corporate interests who have threatened litigation against the agency on the issue. Noncompetes restrict one in seven workers and frequently target employees earning $20 an hour or less, leading to stagnated wages and restricting workers’ opportunities to find new and better jobs. 

“We urge the agency to resist calls for additional postponement and act quickly to protect as many workers under this rule as possible,” wrote the lawmakers. “This rule is an important step to ending abusive practices in the labor market, and we support the FTC’s efforts to give workers the voice, dignity, and power they deserve.”

The letter highlights findings from the Federal Reserve of Minneapolis, which illustrate “that ‘non-compete contracts limit our economy’s potential’ by making it more difficult for employers and entrepreneurs to recruit new workers or start new businesses.” 

“Studies have repeatedly shown that following bans on noncompete agreements, wages went up – not just for workers under these agreements, but across the board,” wrote the lawmakers. “As President Biden said in his recent State of the Union address, banning noncompete agreements will mean ‘companies have to compete for workers and pay them what they’re worth.’”

The letter notes that following extensive research on the impacts of noncompete agreements, the Commission has correctly identified that state-level and case-by-case adjudication are insufficient. The FTC has clear authority to promulgate rulemaking on unfair methods of competition under Section 5 of the FTC Act, and it is acting under its Congressional mandate by putting this rule forward.

The letter was also signed by Senators Sheldon Whitehouse (D-R.I.), Bernie Sanders (I-Vt.), Chris Van Hollen (D-Md.), Ron Wyden (D-Ore.), Peter Welch (D-Vt.), Ed Markey (D-Mass.), Sherrod Brown (D-Ohio), Jeff Merkley (D-Ore.), Tammy Duckworth (D-Ill.), Mazie Hirono (D-Hawaii); and Representatives Pramila Jayapal (D-Wash.), Annie Kuster (D-N.H.), Ilhan Omar (D-Minn.), Donald Beyer (D-Va.), Becca Balint (D-Vt.), Nanette Diaz Barragàn (D-Calif.), Jamaal Bowman (D-N.Y.), Greg Casar (D-Texas), Yvette Clarke (D-N.Y.), Chris DeLuzio (D-Pa.), Mark DeSaulnier (D-Calif.), Debbie Dingell (D-Mich.), Valerie Foushee (D-N.C.), Jesus “Chuy” García (D-Ill.), Robert García (D-Calif.), Jared Huffman (D-Calif.), Summer Lee (D-Pa.), Seth Magaziner (D-R.I.), Jerrold Nadler (D-N.Y.), Donald Norcross (D-N.J.), Eleanor Holmes Norton (D-D.C.), Alexandria Ocasio-Cortez (D-N.Y.), Marie Gluesenkamp Perez (D-Wash.), Mark Pocan (D-Wis.), Katie Porter (D-Calif.), Jamie Raskin (D-Md.), Adam Schiff (D-Calif.), Rashida Tlaib (D-Mich.), Jill Tokuda (D-Hawaii), Lori Trahan (D-Mass.), Bonnie Watson Coleman (D-N.J.), David Cicilline (D-R.I.), Henry "Hank Johnson, Jr. (D-Ga.), Robert Menendez (D-N.J.), Danny Davis (D-Ill.), Adam Smith (D-Wash.), Alma Adams, Ph.D (D-N.C.), Val Hoyle (D-Ore.), Raúl Grijalva (D-Ariz.), Dwight Evans (D-Pa.), Nydia Velázquez (D-N.Y.), Cori Bush (D-Mo.), Madeleine Dean (D-Pa.), and Ro Khanna (D-Calif.).

Senator Warren has led the fight to protect workers, consumers, and entrepreneurs from corporate interests: 

  • In February 2023, Senators Warren and Sheldon Whitehouse (D-R.I.) sent a letter to the U.S. Chamber of Commerce calling out the organization for its opposition to the Federal Trade Commission’s proposed rule that would ban employers’ use of noncompete agreements.
  • In June 2022, Senators Warren, Cory Booker (D-N.J.), and Bernie Sanders (I-Vt.), Representatives Bush and Ocasio-Cortez sent a letter to Amazon demanding answers about the company’s proposed worker chat application, which reportedly would ban workers from using certain words and phrases, restricting their ability to discuss their working conditions and basic legal rights, including unionization.
  • In February 2022, Senator Warren and Representatives Jan Schakowsky (D-Ill.), DeLauro, Barbara Lee (D-Calif.), Ayanna Pressley (D-Mass.), and Katie Porter (D-Calif.) reintroduced the Part-Time Worker Bill of Rights Act to strengthen protections for part-time workers and allow them to better balance their work schedules with personal and family needs.
  • In July 2020, Senators Warren and Chris Murphy (D-Conn.) sent a letter to Federal Trade Commission (FTC) Chairman Joseph Simons urging the FTC to take immediate action to protect workers suffering undue harm from the imposition and enforcement of employers' non-compete agreements during the coronavirus disease 2019 (COVID-19) pandemic, and to finalize a rule the FTC discussed earlier this year that would restrict these agreements, protecting workers and helping foster competition.
  • In April 2018, Senators Warren and Murphy, and Ron Wyden (D-Ore.) introduced the Workforce Mobility Act on Thursday to allow workers to pursue new jobs and higher wages without fearing legal action from their former employers.