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How the NLRB’s Memo on Non-Compete Clauses May Affect Health Care Providers

First few Article Sentences

On May 30, 2023, U.S. National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo issued an agency-wide memo announcing her position that — except in limited circumstances — non-compete provisions in employment contracts and severance agreements violate Section 7 of the National Labor Relations Act (NLRA).

This latest guidance follows the NLRB’s February 21, 2023, decision in McLaren Macomb, in which the agency determined that employers may not offer employees severance agreements that include confidentiality, non-disparagement and other provisions that require employees to broadly waive their rights under the NLRA. Prior to that, in July 2022, the NLRB signed memoranda of understanding (MOUs) with the Federal Trade Commission (FTC) and the Department of Justice’s (DOJ) Antitrust Division, both of which include a focus on what they believe are the anticompetitive effects of non-compete agreements.

Lavigne, Joseph F.

Hubert, Thomas P.

Jones Walker LLP

Law, Employment

October 13, 2023

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