The U.S. Federal Trade Commission proposed a rule to ban non-compete agreements, which prevent employees from working for competitors or starting their own businesses after leaving a job. Although the rule was slated for September, legal challenges have left its future uncertain. Had it taken effect, employers would need to revoke such agreements for most American employees.

In an interview with Canadian Lawyer, Jordan Epstein, an employment lawyer at Gowling WLG, emphasized that non-compete agreements should be used sparingly, if at all. He pointed out that Canadian courts are often reluctant to enforce these agreements, viewing them as potential restraints on trade. Epstein advises employers to reserve non-competes for situations where there is a genuine risk of competition due to the employee’s role or industry.

“Employers really should not be using a non-competition agreement for all employees,” he said. “It should only really be reserved for particular circumstances where an employer might be vulnerable to potential competition… because of the employee's position or the particular industry.” 

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