Promotional products professionals and the rest of the American public will have a bit more time to tell the Federal Trade Commission (FTC) what they think of a controversial proposed rule that would, if enacted, ban noncompete clauses under most circumstances.

The FTC originally planned to accept public comment on the proposal through March 20, but recently voted to extend the deadline for feedback until April 19.

Requests from what the FTC described as “interested parties” to extend the deadline was one reason the regulators elongated the comment period by another month.

“While the commission believes that the current 60-day period – which is 74 days after public release of the notice of proposed rulemaking – is sufficient for meaningful comment and public participation, the commission agrees to allow the public additional time to prepare and file comments,” the FTC said.

Those wishing to can submit their opinions about the potential ban online. Snail mail paper comments are accepted too, though the FTC encourages use of the online system.

Proposed Ban on Noncompete Clauses Divides the Industry https://t.co/qwbsG0IYog

— Chris Ruvo (@ChrisR_ASI) February 20, 2023

If you want to submit via paper, write “Non-Compete Clause Rulemaking, Matter No. P201200” on your comment and on the envelope, and mail to: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Ave. NW, Suite CC-5610 (Annex C), Washington, DC 20580. The FTC offers more background on comment submission.

The proposed ban has stoked an outpouring of strong opinions in the North American promo products industry.

A noncompete clause essentially prohibits one party (a worker) from taking another job or starting a business in a similar profession and/or region that competes against another party (the employer).

You knew the FTC was looking at banning #noncompete clauses. Now Congress is considering doing so too. https://t.co/WfjX2qv22I@asicentral @ASI_MBell

— Chris Ruvo (@ChrisR_ASI) March 2, 2023

As currently written, the FTC rule would prohibit employers from inserting noncompete clauses in contracts with essentially all workers – and from in any way representing that a worker is subject to a noncompete.

Noncompetes would still be allowed in the sales of businesses, but with limited application to individuals who owned at least 25% of the company.

The rule doesn’t ban nondisclosure clauses, but does make it clear that nondisclosures worded in a way that act as de facto noncompetes would be prohibited and unenforceable.

After the public comment period concludes, the FTC will assess all the feedback and decide if/when to issue a final rule, which could include changes from what was originally proposed based on public comments and/or other factors.

If the FTC were to approve the ban, it’s likely that legal challenges would follow immediately, which could lead to an injunction that delays implementation.

The FTC is considering the ban following its preliminary finding that noncompetes constitute an unfair method of competition.

Separate from the FTC proposal, the Workforce Mobility Act of 2023 has been introduced in both the U.S. House and Senate. With limited exceptions, the bill, if made law, would prohibit individuals and businesses from entering into, enforcing or attempting to enforce a noncompete clause. The bill currently lies with committees in both Congressional chambers.