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FTC Continues to Target Noncompetes

Client Alert

The Federal Trade Commission (FTC) is targeting noncompete agreements in the healthcare sector, particularly those that may prevent providers from working in areas with high patient need.

On September 10, the FTC Chair sent letters to several large healthcare employers and staffing firms, urging a review of employment and noncompete agreements to ensure they are appropriately tailored and lawful. The letters highlight that unreasonable restrictions on nurses, physicians, and other medical professionals can limit employment options and reduce patient choice, especially in rural communities where healthcare resources are already limited.

While the FTC continues to enforce antitrust laws against noncompetes, it is important to note that it is not currently reinstating the previously proposed nationwide noncompete ban, which courts blocked in 2024. Instead, enforcement will focus on agreements that may be overbroad or unreasonably limit workers’ mobility.

As a call to action, the Deputy Director of the FTC’s Bureau of Competition emphasized that employers, beyond those receiving letters, should review contracts to ensure that any restrictions comply with the law.

As to Ohio, noncompetes remain generally enforceable. The state has not yet enacted statutes limiting noncompetes, but lawmakers have introduced Senate Bill 11, which would (among other restrictions) prohibit agreements that restrict a worker from joining another employer for a specified period, within a specified geographic area, or in a similar role.

Employers (particularly healthcare employers) should review existing noncompete agreements to ensure compliance with current FTC enforcement measures. Should you need assistance reviewing agreements or have questions regarding noncompetes or the content of this client alert, please contact Partners and Co-Chairs of BMD’s Labor & Employment Group, Adam Fuller or Bryan Meek at adfuller@bmdllc.com or bmeek@bmdllc.com


Corporate Transparency Act Update

The Corporate Transparency Act (“CTA”), with an effective date of January 1, 2024, is set to impose strict reporting guidelines on business owners throughout the country. The following provides a brief update on two aspects of the CTA ahead of its effectiveness next week.

The Second Wave of UnitedHealthcare's Prior Authorization Cuts Started in November

In August 2023, UnitedHealthcare released its plan to eliminate roughly one-fifth of its then-current prior authorization requirements. The first round of prior authorization cuts took effect on September 1, 2023. In that round, UnitedHealthcare eliminated the necessity for some prior authorizations for UnitedHealthcare Medicare Advantage, UnitedHealthcare commercial, UnitedHealthcare Oxford and UnitedHealthcare Individual Exchange plan members. The second and final round of prior authorization cuts began on November 1, 2023. The November 2023 Prior Authorization Cuts apply to the same plans as well as community plans (i.e., Medicaid managed care plans).

Legal Uncertainties Remain Following Passage of Issue 1 in Ohio

In the November 2023 General Election, Ohio voters passed Issue 1 which, among other things, “[e]stablish[es] in the Constitution of the State of Ohio an individual right to one’s own reproductive medical treatment, including but not limited to abortion”. Despite passage of Issue 1, questions persist about how its codification on December 7 affects previously passed legislation restricting abortion and related pending court cases.

NLRB Issues Final Rule on Joint-Employer Status

On October 26, 2023, the National Labor Relations Board (NLRB) issued its final rule on determining joint-employer status, departing from its prior 2020 standard. The final rule provides that two or more entities may be considered “joint employers” if each entity has an employment relationship with employees and if the entities share or codetermine one or more employees’ essential terms and conditions of employment. The final rule goes into effect on December 26, 2023, and will only be applied to cases filed after the effective date.

WEBINAR SERIES RECAP | Employment & Labor

BMD Partner and Co-Chair of the Employment & Labor Law Group, Bryan Meek, presented this four-part webinar series on trending topics in employment law.