LibGuides: Employment Law: Ohio and Federal: Noncompetes

Introduction

The new FTC rule on non-competes will make most non-compete clauses illegal. It is scheduled to go into effect 120 days from April 23, 2024.

A non-compete in Ohio is a contract between an employer and employee that states that the employee cannot compete with the employer after termination. Although there are no Ohio Revised Code sections dealing with non-competes in Ohio, case law dictates that a non-compete agreement must be “reasonable” in order to protect the employee.

A reasonable non-compete agreement in Ohio must:

Be no greater than is required for the employer’s protection of a legitimate interest
Not impose an undue hardship on you
Not be injurious to the public

Books

Covenants not to Compete by Mark Filipp
Call Number: KF 1625 .F34
Publication Date: 2007
Employee Noncompetition Law by Donald Aspelund and Eric S. Schlichter
Call Number: KF 3463 .A97
Publication Date: 2011

Ohio Case Law

Raimonde v. Van Vlerah, 42 Oh. St.2d 21 (1975)
The enforceabiility of non-compete agreements in Ohio depends on many different factors. Raimonde v. Van Vlerah, heard by the Ohio Supreme Court, set forth criteria to be used for determining the legality of a non-compete back in 1975. The factors set out in that case remain valid.

Law Review Article

THE DTSA AT ONE: AN EMPIRICAL STUDY OF THE FIRST YEAR OF LITIGATION UNDER THE DEFEND TRADE SECRETS ACT
David Levine and Chris Seaman, Wake Forest L. Rev. (2018). Cited by FTC in its decision to ban noncompetes.

CFR

16 CFR Part 910
The rule was published in the Federal Register on 4/23/24. It scheduled to take effect in 120 days, It will ban most noncompete clauses.
NLRB General Counsel Says Overbroad Non-Compete Agreements Violate the NLRA
JD Supra 5/30/23
Lina Khan’s noncompete crackdown could leave most doctors and nurses out in the cold
The FTC Act gives the agency authority over companies organized to operate for profit but not over nonprofit organizations.
Still, the agency noted some nonprofits could be bound by the rule if they do not operate as true charities. The rule establishes a two-part test to determine if the FTC has jurisdiction over a nonprofit — whether the organization is carrying on business for only charitable purposes, and whether its income goes to public rather than private interests.

Employment Law: Ohio and Federal: Noncompetes

Introduction

Books

Ohio Case Law

Law Review Article

CFR

Links