Russell Beck‘s article about President Biden’s recent Executive Order on noncompete agreements was published by Law360 under the title, “FTC Should Take Nuanced Approach On Noncompete Regs.”
Among other things, Biden’s order encourages the FTC to exercise its rulemaking authority “to curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility.”
Russell’s analysis begins with an overview of recent state and federal initiatives to restrict or eliminate the use of noncompete agreements. With respect to Biden’s recent directive to the FTC, Russell explains that “even assuming that the FTC has authority to regulate in this area, proper regulation of noncompetes is a very nuanced issue with which states have wrestled for over 200 years.”
n the article, Russell notes that there are competing viewpoints about what the FTC should do.
On one side, there are opponents of noncompete agreements who seek to ban them altogether, variously contending that “non-compete clauses inflict real harms on workers and competition and offer no credible offsetting benefits to society,” and that “employers use non-compete clauses to discourage workers from seeking, or even exploring, alternative work and business opportunities.”
On the other side, Russell notes that there are many who urge restraint and suggest “that any regulation should focus on leveling the playing field and adding additional transparency and fairness to the use of noncompetes.” This was the approach suggested by Russell Beck and scores of other experts in the field who recently submitted a letter to the FTC.
Given that it may be more than a year before the FTC issues any noncompete regulations, Russell advises that companies take the following three steps now:
- Reach out to the FTC to share your view.
- Review any restrictive covenant agreements, including those contained not just in employment agreements, but in restricted stock unit agreements, stock option agreements, long-term incentive agreements and other agreements. Also, review all policies and codes of conduct and strengthen them as appropriate.
- Make sure that there is a culture of confidentiality at your company. Training is critical. If you are not providing training at all stages of the employment life cycle — at the time of onboarding, during the employment relationship, and at off-boarding — you are potentially exposing your work to contamination by someone else’s information, and exfiltration and loss of your own trade secrets.
Russell was recently featured on NPR discussing President Biden’s Executive Order. In April 2020, Russell Beck and Erika Hahn’s article about the FTC’s investigation about whether it should regulate noncompetes was published by Law360. In July 2019, Law360 published Russell Beck’s analysis of misconceptions in the noncompete debate. In December 2019, Law360 also published an article by Russell Beck and Erika Hahn about federal noncompete reform efforts.
For up-to-the-minute analysis of legal issues concerning trade secrets and noncompete agreements in Massachusetts and across the United States, read Russell Beck’s blog, Fair Competition Law.
eck Reed Riden LLP is among the leading authorities in trade secret, noncompete, and unfair competition law, and our experience handling these matters is backed by our extensive employment law and business litigation experience. Our hand-picked team combines attorneys with complementary expertise and practical experience.
The Wall Street Journal featured Beck Reed Riden LLP’s noncompete agreement experience. In 2016, the White House issued a report entitled, “Non-Compete Agreements: Analysis of the Usage, Potential Issues, and State Responses,” relying in part on Beck Reed Riden LLP’s research and analysis, including its 50 State Noncompete Survey.
Russell Beck’s work in this area is well recognized, and includes:
- Over thirty working on trade secret, noncompete, and unfair competition matters
- Assisting the Obama White House as part of a small working group to develop President Obama’s Noncompete Call to Action
- Authoring the book Negotiating, Drafting, and Enforcing Noncompetition Agreements and Related Restrictive Covenants (6th ed., MCLE, Inc. 2021), used by other lawyers to help them with their noncompete matters
- Authoring the book Trade Secrets Law for the Massachusetts Practitioner (1st ed. MCLE 2019), covering trade secrets nationally, with a focus on Massachusetts law
- Drafting and advising on legislation for the Massachusetts Legislature to define, codify, and improve noncompetition law
- Teaching Trade Secrets and Restrictive Covenants at Boston University School of Law
- Founding and administering the award-winning blog, Fair Competition Law
- Establishing and administering the Noncompete Lawyers and Trade Secret Protection groups on LinkedIn, with over 1,660 and 870 members, respectively, around the world
- Founded and chaired the Trade Secret / Noncompete Practice for an AmLaw 100 firm
In addition, Russell was honored for his work in this area of law in the 2020 Chambers USA Guide, which stated that Russell Beck is “an expert in the field of trade secret and restrictive covenant law,” and is also noted for his “ability to adjust and come up with successful solutions.” Chambers noted that Russell “basically wrote the new Massachusetts statute on noncompetes” and that “he’s an expert in employee mobility and nonrestrictive covenants.”
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