The Federal Trade Commission (FTC) is taking steps to stop pest control companies from using non-compete agreements, which restrict where and when an employee can work after employment with the company ends, typically to preserve customer contact lists or protect proprietary information.
The agency issued a press release on April 15, stating it ordered Rollins Inc. to stop enforcement of non-compete agreements, and said it sent warning letters to 13 other pest control companies advising them to make sure their employment agreements lack “unfair or anticompetitive non-compete provisions.” At press time, the FTC did not respond to Pest Management Professional‘s request for the names of the other companies it contacted.
Rollins is required to send letters, via mail or email, to employees who signed non-compete agreements to inform them the company “would no longer enforce the non-compete provisions,” the FTC’s press release stated.
When reached for comment by Pest Management Professional, Rollins Inc. responded with this statement: “The order issued by the FTC is consistent with our current practices. Last year, we eliminated the use and enforcement of non-compete agreements for nearly all employees, and we are committed to continuing this practice in the future. We want to maintain our teammates’ ability to seek employment elsewhere if they choose to leave Rollins, while also protecting our company’s proprietary information and confidential customer data. Our primary goal, and that of our brands, continues to be to empower our employees to deliver the best solutions to help our customers manage pest-related issues.”
“Several states, including Washington, California, Oklahoma, Wyoming, North Dakota and Minnesota, prohibit the use of non-compete agreements. Three years ago, the FTC proposed a nationwide ban on non-compete agreements, calling them “an unfair method of competition.” In response, pro-business groups filed lawsuits contesting the decision and the ban was put on hold.
The ban would have taken effect nationwide and allowed any worker who signed a non-compete agreement to work for a competitor or start a competing business immediately after their employment ended. Exceptions applied to senior-level executives as well as the seller and the buyer of a business.
The proposed rule to ban non-compete agreements the FTC issued on Jan. 19, 2023, received more than 26,000 comments during the 90-day public comment period, and the FTC said nearly all voiced support for the proposed ban. After carefully reviewing each comment, the FTC said it based changes to the proposed rule on the input it received. On April 23, 2024, it issued its final rule and on May 7, 2024, published the rule in the Federal Register. The ban was supposed to go into effect on Sept. 4, 2024, 120 days after it was published in the Federal Register.
Alternatives to non-compete agreements include confidentiality, non-disclosure and non-solicitation agreements that meet local, state and federal laws. Pest control companies should review their exiting employee agreements to ensure they remain in compliance.
The FTC’s press release stated it is on a mission to “protect American workers.” It also said it has “prioritized investigating and prosecuting deceptive, unfair, and anticompetitive labor-market practices” and created a Joint Labor Task Force to focus on these efforts.
<p>The post FTC initiates enforcement of non-compete agreements first appeared on Pest Management Professional.</p>
from Pest Management Professional https://www.mypmp.net/ftc-initiates-enforcement-of-non-compete-agreements/
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