(Reuters) – An upcoming executive order from U.S. President Joe Biden will target noncompete agreements, White House press secretary Jen Psaki said on Wednesday.
Noncompete agreements prevent employees who leave one job from taking another potentially better paid one at a competing company. They have been viewed favorably in industries where workers receive extensive training, but criticized for their use in other, less skilled industries.
“The executive order will call on the FTC (Federal Trade Commission) to adopt rules that could help to curtail (these) agreements,” Psaki said.
“Roughly half of private sector businesses require at least some employees to enter noncompete agreements, affecting over 30 million people. This affects construction workers, hotel workers, many blue collar jobs not just high level executives,” said Psaki.
“He (Biden) believes that if someone offers you a better job you should be able to take it.”
Psaki said the order would also call on the FTC to adopt rules banning unnecessary occupational licensing agreements.
The FTC has probed the practice’s effect on workers. The FTC has sought to determine which industries may have a need for occupational licensing and which use licensing to prevent competition.
(Reporting by Trevor Hunnicutt; additional reporting by Diane Bartz and David Shepardson; Writing by Merdie Nzanga and Doina Chiacu)
