Prior to a Marine One departure from the South Lawn of the White House on July 7, 2021 in Washington, DC, US President Joe Biden speaks to members of the press. Getty Images/Alex Wong WASHINGTON, DC – President Joe Biden will release an executive order in the near future that directs the Federal Trade Commission to create rules to limit worker non-compete agreements, as part of a broader series of executive actions aimed at enhancing market competition. According to White House press secretary Jen Psaki, the order will be signed and disseminated in the coming days, and it will fulfill Biden’s “campaign commitment to foster labor market competitiveness.” Biden would also ask the FTC to prohibit “unnecessary” occupational licensing requirements, according to Psaki. “While occupational licensing can help with essential health and safety concerns, unduly cumbersome licensing can keep people out of work,” she continued. Biden will also call on the Federal Trade Commission and the Department of Justice to collaborate to limit businesses’ rights to share employee salary information in ways that could harm workers looking for better positions. The orders’ language has not been made public, but their long-term success will be determined by whether the regulators who write them make them capable of withstanding legal challenges and really forcing market change. Individual states, not the federal government, normally establish occupational licensing standards, so it’s unclear how much impact new federal restrictions would have on state regulations. These orders, taken collectively, are part of a larger campaign by the Biden administration to create more competition in the US economy by limiting how major businesses and employers can exert control over their competitors and employees. The idea of utilizing executive branch actions to strengthen workers’ hands and rein in industry behemoths dates back to the Obama administration’s closing years. President Barack Obama issued an executive order in the spring of 2016 to “promote competition” by directing federal agencies to combat anti-competitive behavior within their jurisdictions. Vice President Joe Biden, at the time, was also a strong supporter of ending non-compete clauses. In an October 2016 remark, Biden said, “Folks, no one should have to sit on the sidelines because of an unnecessary non-compete clause.” “We have the world’s most dynamic and productive people, but they can’t fulfill their full potential until they have the freedom to negotiate a higher wage with a new employer or find another job after being laid off.” The election of US President Donald Trump in 2016 effectively put a halt to plans to extend regulations across the entire US economy. Instead, it ushered in four years of fiscal and regulatory liberalization. Biden campaigned against Trump in part on a promise to abolish non-compete restrictions. The agreements, according to his 2020 campaign, “hinder employees’ ability to seek higher compensation, better benefits, and working conditions by changing firms.” The election of Biden in November turned the policy switch once more, bringing the broader discussion about how to empower small businesses and individual workers back to the forefront of government legislation./n
Read More
