FTC issues noncompete warning letters to healthcare employers

Federal Trade Commission Chairman Andrew Ferguson sent warning letters on Sept. 10 to multiple large healthcare staffing firms and employers, urging them to review employment agreements for possible unlawful noncompetes or restrictive terms.

Such agreements, often applied to healthcare roles like nurses, physicians and other medical staff, can unfairly restrict job mobility and limit patient choice for who provides their medical care, particularly in rural areas where care access can be strained, according to a Sept. 10 commission news release.

“Enforcement against unreasonable noncompete agreements remains a top priority for the Federal Trade Commission,” Kelse Moen, deputy director of the Bureau of Competition and co-chair of the agency’s Joint Labor Task Force, said in the release. “We strongly encourage all employers—not just those receiving letters today — to review their contracts closely, to ensure that any restrictions on employee mobility are in full compliance with the law.”

Under Section 5 of the FTC Act, the commission has authority to investigate unfair competition methods, like noncompetes that are unjustified or overbroad.

The letters come after the commission withdrew from defending the Biden administration’s proposed nationwide noncompete ban, which was blocked in court. While the revocation eases regulatory pressure on consolidation — specifically for smaller or regional transactions — regulators stressed that existing antitrust laws remain in effect and that enforcement actions against anticompetitive practices will continue.

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