The FTC banned noncompetes. What that means for workers and companies.

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The Federal Trade Commission has banned noncompete agreements for most of the U.S. workforce, freeing an estimated 30 million people bound by contracts that limit their ability to change jobs within their industry or strike out on their own.

Labor advocates cheered Tuesday's decision as a huge victory for workers, arguing that such agreements smother competition and hinder Americans' earning powers. "The FTC's final rule to ban noncompetes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market," FTC Chair Lina M. Khan said in a statement after the panel's 3-2 vote.