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  • The FTC’s Unlawful Attempt to Ban Noncompete Clauses

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    January 06, 2023
    January 5, 2023
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    Chamber Bulletin
    • The FTC's attempt to ban noncompete clauses is blatantly unlawful.
    • Job openings dropped in November, but there are still 4.45 million more openings than unemployed workers.
    • Successful funding of a bridge shows bipartisanship can work in Washington.
    • Marriott CEO Anthony Capuano will be at State of American Business 2023 next week.
    • The Senate should reject Gigi Sohn's renomination to serve as FCC Commissioner.
    FTC Oversteps in Banning Noncompetes

    Today, the Federal Trade Commission released a proposed rule banning employer noncompete clauses in all employment circumstances. This unprecedented attempt overturns well-established state laws which have long governed their use.

    Why it matters: Noncompete clauses are important when it comes to fostering innovation and promoting competition. Businesses may use them for a variety of reasons, such as limiting dissemination of trade secrets, access to sensitive information, or ensuring return on investments made in employee training.

    Go deeper: The Federal Trade Commission lacks any statutory authority that even comes close to giving it the authority it claims to propose such a rule.
    • The only rulemaking authority granted to the agency by Congress is limited and applies to unfair and deceptive acts and practices through specific procedures commonly referred to as “Magnuson-Moss authority”.
    • Congress has not authorized the FTC to engage in competition rulemaking. Instead it empowers the FTC to exclusively undertake case-by-case administrative adjudication of competition cases to shape the law.

    Bottom line: “Today’s actions by the Federal Trade Commission to outright ban noncompete clauses in all employer contracts is blatantly unlawful,” said Chamber Vice President Sean Heather.
    • “Since the agency’s creation over 100 years ago, Congress has never delegated the FTC anything close to the authority it would need to promulgate such a competition rule. The Chamber is confident that this unlawful action will not stand.”
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    Job Openings Remain High
    4.45 million jobs
    The latest job openings data shows that businesses are still struggling to find workers.

    Why it matters: There are 4.45 million more job openings than unemployed workers.

    By the numbers: Job openings were 10.5 million at the end of November.
    • That is down 54,000 from October.
    • Job openings increased in professional and business services (212,000) and in nondurable goods manufacturing (39,000).
    • They decreased in finance and insurance (75,000) and in federal government (44,000).

    Be smart: The quit rate was 2.7% in November. That is below the all-time high rate of 3%.
    • 4.2 million people quit their jobs in November, down from the 4.45 million all-time high in March, but it is still historically high.

    Bottom line: The cooling economy is causing openings to drop, but not by much. The labor market remains tight. Hiring and quits remained at roughly the same level as October. So businesses are still adding workers and workers are still confident they can quit their current jobs and find better ones easily.
    • The still-strong labor market is a big part of our narrative on the economy of “second-hand pessimism.” Businesses say the economy is poor, but they’re still hiring as if it’s strong.
    Curtis Dubay
    Curtis Dubay
    Chief Economist, U.S. Chamber
    One Week Away from State of American Business 2023
    state of american business 2023
    Thursday, January 12, join business leaders for the State of American Business 2023, the Chamber’s premier annual event.

    Why it matters: Following Chamber President and CEO Suzanne P. Clark's keynote exploring the challenges and opportunities that lie ahead for America’s businesses in 2023 and beyond, we will host conversations with top business leaders:
    • Marriott CEO Anthony Capuano
    • Nasdaq President and CEO Adena T. Friedman
    Bridge Funding Shows Bipartisanship Works
    Yesterday in Kentucky, President Joe Biden and Senate Republican Leader Mitch McConnell celebrated the awarding of $1.64 billion in funding for the Brent Spence Bridge crossing the Ohio River.

    Why it matters: As part of the Chamber’s decades-long push to enact a historic infrastructure bill, we launched a successful campaign in February 2021 highlighting the failing bridge as the type of project that demanded Congress' attention.

    Be smart: The Chamber successfully engaged with government and local partners to help fund this and other critical infrastructure projects across the country.
    • The Chamber applauds President Biden, Leader McConnell and the other Republican and Democratic elected officials who are helping move our nation forward.
    • This was also made possible by the sustained advocacy efforts of state and local chambers in the region including the Kentucky Chamber of Commerce, the Ohio Chamber of Commerce, the Northern Kentucky Chamber of Commerce, and the Cincinnati USA Regional Chamber.

    Our take: The Infrastructure Investment and Jobs Act is an excellent case study of how bipartisanship can lead to progress on big initiatives. The Chamber will continue to focus on building coalitions across the aisle in both the House and Senate to get important initiatives accomplished on behalf of the American business community and American families.
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    Gigi Sohn is Still the Wrong Pick for the FCC
    This week, President Biden renominated Gigi Sohn to serve as Commissioner on the Federal Communications Commission. This is her second nomination, after the Senate refused to advance it last Congress.

    Why it matters: The Federal Communications Commission plays a vital role in regulating America’s telecommunications industry and the ability of Americans to access the cutting-edge communications tools necessary for their success. Gigi Sohn’s extreme views threaten that success.

    Our take: “The Chamber believes that the FCC and the public interest would be better served by a different nominee,” said U.S. Chamber Technology Engagement Center vice president Jordan Crenshaw.
    Read More
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    How to Improve Your Chances of Getting Paid
    Here are some strategies for achieving accounts receivable results.
    Learn More
    • Gary Litman, Chamber Senior Vice President for Global Initiatives, explains why the G20 is important and the role India will play as host in 2023.
    Digital Transformation Summit
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    February 2, 2023
    10:00 AM ET
    Experts will gather who seek to modernize government technology systems.
    Register Now
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