Trump Administration Drops Defense of Biden-Era Noncompete Rule

The Trump administration announced that it is no longer defending a rule established during the Biden presidency, which aimed to prohibit noncompete agreements often signed by employees to prevent joining rival firms or starting competing businesses.

This decision follows actions by the U.S. Justice Department to dismiss ongoing appeals in federal courts concerning the rule, which had already been invalidated by judicial rulings. The rule, implemented by the U.S. Federal Trade Commission, faced opposition from Republican figures and business entities, who challenge its legality.

While the FTC argued that such agreements suppress worker wages and movement, critics, including FTC Chairman Andrew Ferguson, argue the agency overstepped its authority. The latest FTC case against a pet cremation company highlights ongoing regulatory efforts amid political and legal debates on noncompete contracts.

(With inputs from agencies.)