OOIDA supports FTC’s noncompete proposal

The Owner-Operator Independent Drivers Association offered support to a proposal from the Federal Trade Commission that would prohibit noncompete clauses for workers, including independent contractors.

“No matter the circumstance, we have found that noncompete clauses are harmful to the trucking industry,” the Association wrote in formal comments filed to the FTC on Wednesday, April 19. “OOIDA concurs with FTC’s findings that noncompete clauses have negatively affected competition in labor markets, resulting in reduced wages for workers across the labor force, and have restricted individual opportunities to find work. We support FTC’s proposal to prohibit employers from imposing noncompete clauses on workers, including independent contractors.”

In January, the FTC published a notice of proposed rulemaking that would “provide that it is an unfair method of competition for an employer to enter into or attempt to enter into a noncompete clause with a worker; to maintain with a worker a noncompete clause; or, under certain circumstances, to represent to a worker that the worker is subject to a noncompete clause.”

The public had through April 19 to comment on the proposal. According to the Regulations.gov website, the FTC received more than 16,000 comments.

OOIDA said that noncompete clauses have been used in harmful ways to truck drivers.

“In our experience, some motor carriers have used noncompete clauses in their contracts to pressure drivers to keep working for them,” OOIDA wrote. “We believe this restricts wages of professional drivers and also contributes to unsafe practices that force drivers out of the trucking industry.”

Broker concerns

The Association said it would like additional steps to be taken in order to keep professional and safe truck drivers in the industry.

“OOIDA has been communicating to the federal government for decades about inadequate broker regulations that are rarely, if ever, enforced,” the Association wrote. “This has resulted in an inequitable economic environment for motor carriers, especially small businesses that are victimized by unscrupulous brokers.”

A ban on noncompete stipulations from future broker-carrier agreements should be included in any final rulemaking, OOIDA said.

Worker classification

OOIDA said the owner-operator model is well-established in the trucking industry and has provided millions of truckers to be true independent contractors. OOIDA cautions the commission from implementing the prohibition of noncompete clauses “in a manner that would exacerbate the misclassification of professional truck drivers.”

What’s next?

The FTC will now be tasked with reviewing the more than 16,000 comments before deciding if it will move forward with a final rule.

“OOIDA supports FTC’s proposal to prohibit employers from imposing noncompete clauses on workers, including independent contractors,” the Association wrote. “We believe these clauses negatively affect competition in labor markets, restrict an individual’s opportunity to find work, and can significantly reduce workers’ wages.” LL