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The Implications of the FTC’s Ban on Non-Compete Clauses

The possible banning of non-compete clauses by the Federal Trade Commission is a story which I’ve been following for quite some time. In fact, I wrote an article about it for The VET Recruiters last year (“The Banning of Non-Compete Clauses for Animal Health and Veterinary Employers”).

In that previous article, I mentioned that a ruling was forthcoming this year, and that ruling has occurred. A little over a week ago, the FTC voted to ban non-compete clauses for for-profit employers in the United States. It might not surprise you to know that the vote was close (3-to-2). It also might not surprise you to know that the U.S. Chamber of Commerce has already filed a lawsuit against the FTC for what it views as “exceeding administrative authority.”

In addition, the final rule is different than the proposed rule that the FTC put out for public comment over a year ago. That rule would have applied to ALL non-compete agreements, meaning those that already exist and those that have yet to be signed. In the latest iteration of this ruling, though, there is one segment of the workforce to which this new rule would not apply: senior executives.

Senior executives are those who earn more than $151,164 on an annual basis and who are also in what is described as a “policy-making position.” However, the ban on future non-competes also applies to senior executives, so if this rule ultimately goes into effect, non-competes will eventually “die a natural death” as every senior executive in a “policy-making position” either finds a new job, retires, or leaves the workforce for another reason.

The FTC made this latest ruling on April 23. According to the FTC, the rule will be officially effective 120 days from its publication in the Federal Register. But once again, as mentioned above, this ruling is also facing and will continue to face staunch opposition and legal challenges. While it’s possible that the rule might go into effect sometime during the summer of this year, that is in no way a foregone conclusion.

Effective Strategies for Employee Retention

Non-compete clauses have existed and do exist within the Animal Health industry and Veterinary profession. Organizations often ask new employees to sign them, and some of those employees do sign them. In addition, in a profession like the Veterinary profession, where qualified candidates are scarce, non-compete clauses have become even more of a factor in terms of recruiting, hiring, and retention.

In fact, there have been a handful of Veterinary employers willing to help their new employees if they are sued by their previous employer for allegedly violating the non-compete clause that they signed with that employer. And when I say “help” them, I mean even to the point of assisting them with legal fees and counseling should the matter go to court. This underscores the severity of the veterinarian shortage in recent years and the lengths to which employers will go in their efforts to secure talent for their organization.

Non-compete clauses are similar to counteroffers in that employers sometimes use each of them in an attempt to retain their employees, especially their top employees. However, these tactics are NOT the best way to retain people. Instead, the possible banning of non-compete clauses only serves to make effective retention strategies even more critical. I’ve outlined five of those strategies below:


Benefits: Employee engagement refers to the level of emotional commitment and dedication employees have towards their work and the organization. Engaged employees are not only satisfied with their jobs, but they’re also motivated to go above and beyond to contribute to the company’s success. High levels of engagement have been linked to increased productivity, higher job satisfaction, and lower turnover rates.

Implementation: Organizations can cultivate employee engagement by providing opportunities for meaningful work, clear communication, recognition and rewards, and a supportive work environment. By involving employees in decision-making processes, soliciting feedback, and recognizing their contributions, employers can demonstrate that they value and appreciate their workforce, leading to greater engagement and loyalty.

#2—Employer Branding

Benefits: Employer branding refers to the reputation and image of an organization as an employer. A strong employer brand attracts top talent, helps create employee pride and loyalty, and enhances the organization’s ability to retain its employees. A positive employer brand communicates to current and prospective employees what it’s like to work for the company and sets expectations for the employee experience.

Implementation: Employer branding encompasses various elements, including the company’s mission, values, culture, benefits, and work environment. Organizations can enhance their employer brand by effectively communicating their unique value proposition, showcasing employee testimonials and success stories, and actively engaging with candidates and employees on social media and other channels.

#3—Company Culture

Benefits: Company culture refers to the shared values, beliefs, attitudes, and behaviors that characterize an organization. A strong and positive company culture helps build a sense of belonging, teamwork, and alignment with organizational goals, ultimately leading to higher employee satisfaction and retention. Employees are more likely to stay with organizations where they feel connected to their colleagues, supported by their leaders, and inspired by the company’s mission and values.

Implementation: Organizations can cultivate a positive company culture by defining their core values, promoting open communication and collaboration, and promoting a supportive and inclusive work environment. By prioritizing employee well-being, recognizing and celebrating achievements, and encouraging a sense of community, organizations can create a culture that attracts and retains top talent.

#4—Core Values

Benefits: Core values are the fundamental beliefs and principles that guide an organization’s behavior and decision-making. They serve as a compass for employees, helping them understand what the organization stands for and how they are expected to conduct themselves in their roles. When core values are aligned with employees’ personal beliefs and aspirations, they feel a deeper connection to the organization and are more likely to remain engaged and committed.

Implementation: Organizations should articulate their core values clearly and integrate them into all aspects of the employee experience, from recruitment and onboarding to performance management and recognition. By living their core values every day and holding employees accountable for upholding them, organizations can reinforce their culture and strengthen employee engagement and retention.

#5—Professional Development

Benefits: Professional development refers to the ongoing process of acquiring new skills, knowledge, and experiences to enhance one’s career growth and performance. Employees value opportunities for learning and development, as it not only helps them stay relevant in their roles, but it also prepares them for future career advancement opportunities within the organization.

Implementation: Organizations can support employee retention by investing in professional development initiatives such as training programs, mentorship opportunities, tuition reimbursement, and career development resources. By empowering employees to learn and grow, organizations demonstrate their commitment to their employees’ long-term success and fulfillment, which in turn enhances loyalty and retention.

Even if the FTC’s recent ruling does not become final, keep in mind that three states (California, North Dakota, and Oklahoma) and the District of Columbia have nearly banned non-competes already, while other states allow them but with restrictions. It may be only a matter of time before more states do the same, regardless of what happens with the FTC’s latest ruling.

That’s why it’s even more important to make sure that your Animal Health or Veterinary organization is doing everything it can to engage, empower, and retain its employees . . . so it won’t have to rely upon a non-compete clause or counteroffer to retain them.

We invite you to find out more about our Veterinary recruiting services for employers and also learn more about our recruiting process and how we can help you hire more veterinarians this year.

We help support careers in one of two ways: 1. By helping Animal Health and Veterinary professionals to find the right opportunity when the time is right, and 2. By helping to recruit top talent for the critical needs of Animal Health and Veterinary organizations. If this is something that you would like to explore further, please send an email to stacy@thevetrecruiter.com.

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