Last month, the Regulatory Review, a publication of the Penn Program on Regulation, published an article on a workshop held by the Federal Trade Commission non-compete clauses in employment contracts. The FTC asked whether and how to regulate these clauses during and for a time after employment.
The answer to the FTC’s question is clear: It should consider regulating non-competes by administrative adjudication. Regulating these clauses through adjudication is about as ideal a use of policymaking by adjudication as an agency can get; a new policy would not impose an affirmative duty on private actors, would likely receive Chevron deference, and would not be subject to OIRA review.”