“I suspect that the three unelected technocrats are somehow on the right track when thinking about the noncompetitors and that all the previous legal minds to look at this issue got it wrong, ‘ she wrote, as an unelected technocrat. The American Chamber of Commerce calls the proposed change “illegal act” and stated that the removal of non-competitors would boring innovation. Why would a company bother investing in innovation, or even training workers in specialized skills, if those ungrateful guys can get that knowledge out the door?
Khan dryly notes that California companies, despite the state’s ban on non-competing firms, have managed to innovate pretty well. You know… Apple, Disney, Google, he was Invented AeroPress. And she has a message for those companies that will now face the dreaded prospect of losing those provisions if the FTC rule becomes official. “Ultimately, companies have to invest in workers if they want to be successful,” she said. “You retain talent by being truly competitive, giving them higher salaries, better benefits, better investment and training opportunities. That’s how you maintain a high employee retention rate instead of locking employees in place.”
As for the fear of workers stealing intellectual property, Khan says her rule won’t affect the trade secret lawsuit, though she doesn’t want trade secret restrictions explained. so widespread that they become a form of non-competition.
Although the non-compete rule is only at the proposal stage, Khan thinks her agency has made a pretty good case. “I mean, that’s a 218-page rule!” she speaks. “Nearly half of them are looking at very, very carefully experimental studies.” But she also encouraged anyone with an opinion or relevant evidence to participate during the 60-day comment period ending March 10, and said the agency would look at everything with an open mind. open. But with a 3–1 majority of Democratic commissioners, it is fair to predict that the body will gain its rule in one form or another.
I asked Khan if she would consider the rule a natural experiment of her own, testing to what extent the FTC could be infringing before the Supreme Court dealt the blow to her. Last June, court ruling that the EPA has exceeded its limits in regulating carbon emissions. Concurring with the majority opinion, Judge Neil Gorsuch promoted a doctrine that agencies cannot introduce sweeping new regulations unless Congress explicitly passes them.
Khan responded by citing Congress’ original intention for the FTC to ensure competition. “It’s an agency that, especially in recent decades, hasn’t been used much and I think it’s kind of a travesty,” she said. “We as enforcers have an obligation to enforce the laws that Congress accuses us of. I think we have pretty clear authority, pretty clear precedent. If we face legal challenges, we will stand ready to defend ourselves completely.”
Khan’s case against non-compete provisions is strong. But five and potentially six of the current Supreme Court justices aren’t used to wind-kissing over labor, big or small. Instead, they seem amused by directing phlegm in the faces of workers. assert their rights-or governing body who want to extend those rights. If they rescind Khan’s rule, she’ll have as little power to reinstate it as Prudential’s security guards, who are trapped in their miserable jobs by non-compete terms.
