The Work Week with Bassford Remele

September 8, 2025

Welcome to another edition of The Work Week with Bassford Remele. Each Monday, we will publish and send a new article to your inbox to hopefully assist you in jumpstarting your work week. This week, we bring two topics to your inbox.

Bassford Remele Employment Practice Group

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Navigating the FTC's Latest Action on Noncompetes -- Practical Guidance for Employers

Rachel A. Ball

During the first week of September 2025, the Federal Trade Commission (“FTC”) sharpened its focus on noncompete provisions — one of the hottest issues in labor and employment law. On September 4, 2025, the FTC launched a public Request for Information (“RFI”) regarding noncompete agreements and simultaneously initiated enforcement action against Gateway Services, Inc., the largest pet cremation business in the United States, for imposing overly broad noncompetes on its workforce.

Employers must understand this regulatory shift and adapt accordingly. This article explores the FTC’s recent moves and offers practical guidance on using lawful alternatives to safeguard business interests.

The FTC’s Request for Information on Employee Noncompetes

To root out cases for possible prosecution of unfair and anticompetitive conduct, the FTC’s RFI seeks public input on the scope, prevalence, and competitive impact of noncompete agreements. It invites responses from current and former employees, as well as employers affected by competitor noncompetes. With a comment period running through November 3, 2025, the RFI provides employees and employers alike a timely opportunity to weigh in on one of the hottest topics in employment law. This is a critical window in which employers can share data, experiences, or legal perspectives—both to shape policy and to signal compliance-minded intent—with the federal agency in charge of shaping policy and compliance with consumer protection and unfair and anticompetitive business practices.

Noting its concern that noncompetes stymie innovation while simultaneously negatively impacting workers’ and consumers’ quality of life, the FTC expressed its desire to curtail noncompetes that unjustifiably prevent progress in the labor market, whether that is due to workers to moving to better jobs, impeding new business formation, or even harming rival employers’ ability to compete. Importantly, the RFI singles out the healthcare-sector, noting the FTC’s concern that noncompetes may limit healthcare professionals’ employment options and correspondingly adversely impacting patients’ choice of healthcare provider, especially in rural market where services are already stretched thin. Although the RFI seeks input from any member of the public, it singles out those in the healthcare sector as particularly encouraged to share information about the use of noncompete agreements with the FTC.

FTC’s Enforcement Action Against Gateway Services, Inc.

As further evidence of its crack down on usage of unlawful noncompetes, the FTC filed a complaint on September 4, 2025, against Gateway Services, Inc., the largest pet cremation business in the United States. The FTC’s complaint alleges Gateway imposed unlawfully broad noncompete restrictions on almost all of its 1,992 U.S.-based employees prohibiting them from working in the pet cremation industry anywhere in the U.S. for one year post-employment. The complaint alleges Gateway’s usage of noncompetes lacks individualized consideration of an employee’s role within the business. The complaint also cited specific evidence which the FTC contends is proof of Gateway’s unlawful anticompetitive behavior and intent in requiring the noncompetes.

The FTC’s proposed consent order, filed contemporaneously with the complaint, would require Gateway to immediately stop enforcing all existing noncompete provisions, with only limited exceptions, and notify employees they are no longer bound by such agreements. The proposed consent order would further limit Gateway’s enforcement of its non-solicitation clauses to only allowing restrictions on soliciting customers with or to whom the employee has had direct contact or personally provided service in the past 12 months.

Practical Compliance Recommendations: Enforceable Alternatives to Noncompetes

The FTC’s renewed scrutiny—manifested through both a public information request and enforcement action against Gateway—signals a clear shift toward dismantling broad noncompetes as a matter of competition policy. As we have previously indicated in recent issues of the Work Week, employers can adapt by prioritizing lawful, narrowly tailored tools, reinforcing retention through innovation and culture, and actively engaging with regulators via the RFI process.

Such lawful and strategic tools employers can rely on in lieu of noncompete clauses include:

Trade Secret Protections

• Trade secret laws protect confidential business information without the mobility restrictions inherent in noncompetes.
• Clearly define what constitutes “confidential” or “proprietary” information and ensure appropriate security and handling procedures.

Nondisclosure Agreements (NDAs)

• The FTC has validated NDAs as a valid tool, noting that more than 95 % of workers who sign noncompetes also already sign NDAs.
• Construct these narrowly to prevent misuse or overly broad scope.

Non-Solicitation Clauses (Customer/Employee)

• These are permissible when narrowly tailored. As mentioned above, the Gateway proposed order allows non-solicitation restrictions, albeit limited to customers the employee had direct contact with or personally served in the past 12 months.
• Avoid blanket bans that violate reasonable scope or duration.

Enhanced Retention Through Competitive Compensation

• Invest in wages, benefits, culture, and career development rather than restrictive covenants. Employees remain because the environment is desirable—not because they are constrained.

Training and Policy Awareness

• Educate management on the limits of permissible restrictive covenants.
• Encourage early legal review of any clause that might impede worker mobility or appear anticompetitive.

Responding Thoughtfully to the FTC’s RFI

• Employers should consider submitting comments that:
  • Provide empirical data on how noncompete agreements affect hiring, wages, turnover.
  • Describe how alternatives such as NDAs and trade secret protections have met employer needs without chilling competition.
  • Highlight competition harms in your market due to noncompetes.

In summary, employers still have an arsenal of tools to protect confidential, proprietary information and protect their businesses while maintaining compliance with consumer protection and unfair and anticompetitive business practices. Bassford Remele’s Employment group continues to monitor legal trends at the state and federal level, and regularly advises employers on restrictive covenant issues, such as noncompetes. We are available to help with reviewing your company’s current agreements, drafting compliant clauses, or preparing a submission to the FTC’s RFI. Please reach out with any questions or if you need assistance.

Newsletter: The Work Week with Bassford Remele

Each Monday, the Bassford Remele Employment Team publishes and sends an article on a timely topic to your inbox to hopefully assist you in jumpstarting your work week. (Previous articles can be found at the bottom of the Employment Practice Group page.)

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The Work Week with Bassford Remele, 09-08-25 (print version)

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Bassford Remele proudly serves as local and national counsel for many major corporations and Fortune 500 Companies and is a go-to litigation firm representing local, national, and international clients in state and federal courts across the region. The firm provides comprehensive counsel and representation in litigation and dispute resolution, family law, and corporate matters, ensuring prompt and effective service for its clients.

Established in 1882, Bassford Remele is proud to be the oldest top-25 law firm based in Minnesota.

Bassford Remele | September 8, 2025