How Will The FTC Noncompete Clause Effect Your Hiring?

After voting 3-1 last month, the Federal Trade Commission has proposed a rule to ban noncompete clauses in the U.S. The FTC has stated that they believe noncompete clauses harm innovation in business and suppress wages, ultimately violating the FTC’s fair trade laws. 

A ban on noncompete clauses could help the economy

1 in 5 workers are affected by noncompete clauses. By limiting workers ability to change jobs and achieve upward mobility we see a lack of healthy competition, something that drives our economy. 

Moving to ban noncompete clauses may increase wages

Economists also believe noncompete clauses are to blame for stagnant wages in recent years. The FTC estimates that by implementing this new rule, wages will increase by about $300 million yearly. By banning noncompete clauses in Oregon, a study in 2021 found that wages for low-wage workers rose by 2% to 3%. 

Noncompete clauses are very important for businesses that depend on trade secrets and their highly educated employees. Though the clauses make sense for high-level employees, many are suggesting regulation on their use among low-wage employees instead of eliminating them all together. 

Many assume non-competes to be non-negotiable

Some may argue that employees have the right to negotiate noncompetes in their contract or simply decline job offers that attempt to implement noncompete clauses, but many job seekers are not aware of these clauses until after being hired.

In 2015 The Journal of Law and Economics found that only 10% of employees negotiated over noncompete clauses in their contracts, assuming they had no say in the matter. 

FTC noncompete bans would affect current and future noncompete clauses

The FTC’s new proposal would not only make it illegal for employers to implement noncompete clauses, but it would also require employers to eliminate any current clauses and inform all employees of the change. 

Though we would not see this potential ban on noncompetes until late 2023, many employers will likely begin making changes to other confidentiality provisions in anticipation of this change.

Catalyst Career Group is committed to matching quality candidates with great companies all over the nation. We make it easy for job seekers with our friendly welcome orientation, informative event guides, and seminars specifically designed to help you advance your career at in-person and virtual job fairs.

And Private Recruiting Events allow you to meet with employers at their office, conference room, or virtually (over phone or video interview). While multi-company job fairs work well to meet many candidates for a broad range of positions, we’ll bring you directly to the door of the person who is hiring today.

Learn more about how Catalyst Career Group helps employers hire the right people for your position! >>

Top 6 Best Employee Benefits To Provide In A Recession

With whispers of a recession from increased economic inflation, many hiring managers are considering their benefits packages when sourcing talent. Companies require happy, competent, and healthy team members to be successful, while team members want a stable income, job satisfaction and professional development. The Society of Human Resource Management (SHRM) study shows that the average cost of a new hire is $4,129 per employee. With a cost this high, knowing how to keep employees while still spending the money to do so, takes planning.

Considering both the hiring sides, here are our top six best employee benefits to provide in a recession.

1. Financial wellness program

What does your financial wellness program consist of? Some retirement planning, investing, and also ongoing financial education related to taxes, budgeting, student loans, debt management, estate planning, and saving for college. This financial education will help your team know how finances affect their families and how to have more stability with their money.

A good financial wellness program will help increase your employees satisfaction,” says Jeff Naugle, Co-Owner of Catalyst Career Group. “It also helps them reduce their stress associated with the economy and top headlines of the day. Easing your team’s stress means they will be a happier and more content worker.

2. Short-term employee loans

In the chance that a financial emergency does take place in your team’s personal life, do you have support through your company for them? With most employees living paycheck to paycheck, if they are in need, instead of turning to a high-interest-rate payday loan, consider how your company can help. You can offer low-interest short-term employee loans in this case. Monthly payment can be deducted directly from the employee’s paycheck and can help resolve immediate emergencies without long-term debt consequences.

3. Mental health benefits

Speaking of financial needs, most employees have shown in surveys that financial stress contributes to their mental health issues. These statistics are staggering. 45 percent of U.S. adults depressed about their finances. Other studies show even higher numbers, which is why nine out of 10 companies now offer some sort of mental health benefit. Mental health benefits include EAPs, mental-health insurance coverage, substance abuse treatment benefits, and stress management.

4. Integrated savings accounts and/or savings matching

Once of the best ways to overcome the stress of finances is to help your team save money through a savings account. Accounts can be tied to the employee’s retirement account with payroll deductions.

“This will help your team save for short-term and long-term needs at the same time,” says Jeff Straub, Co-Owner of Catalyst Career Group “Having an emergency fund helps your team eliminate the stress that goes into the unexpected.”

5. Wellness apps

While your company already offers health insurance, you can also offer wellness apps. These may include Castlight, Virgin Pulse, and WebMD. These help your team to develop both their physical and emotional habits.

6. Student loan repayment assistance

Have you considered supporting your team’s student loan payments? You can offer resources to help them refinance or you can do matching contributions to bring down their balance. A SCORE survey found that 75 percent of those who had student loans wished their employers would offer some sort of student loan repayment benefit or refinancing option. If you are looking to keep younger talent, loan repayment support is exactly what those in their 20s-40s are looking for today.

So what is your take? Would any or all of these six benefits help your organization retain and attract top talent? Studies think so and that makes it worth exploring. Consider for your self how your company can be better equipped to retain employees during a recession, which will lessen the negative impact of a weak economy.

Consider how you can beat inflation for your organization and hire the right people in the right positions at the right price point. Ask us about our virtual job fairs or private hiring events and what job descriptions will draw out the right candidates to help you be successful during this season! Contact Catalyst Career Group today.