In January 2023, the Federal Trade Commission (FTC) issued a proposed rule that would ban most noncompete agreements throughout the United States. After receiving more than 26,000 public comments, this past April the FTC voted 3-2 to approve a final rule. The final rule covers any type of worker, including employees and independent contractors. Any existing noncompete agreement for a "senior executive" (defined as a worker earning more than $151,164 who is in a "policy-making position") could remain in force, but no new compete-agreements would be permitted for any workers. For existing noncompete agreements (except for a "senior executive"), the final rule would require employers to notify their employees that their non-compete agreements are no longer enforceable. Noncompete agreements that are part of the sale of business would continue to be permitted and enforceable.

The final rule purported to allow nondisclosure/confidentiality agreements and nonsolicitation agreements (for example, an agreement restricting an employee from soliciting an employer's clients or customers). However, such provisions could still be prohibited if they are so broad in scope that they essentially function as a noncompete agreement. The final rule was scheduled to become effective on Sept. 4, 2024.