Pest Control: FTC Targets Bothersome Non-Competes

On April 15th, the Federal Trade Commission (FTC) brought a complaint against Rollins, Inc., one of the country’s largest pest-control companies, for its enforcement of non-compete agreements in violation of Section 5 of the FTC Act.  On the same day, the FTC filed a proposed consent order that would require Rollins to cease and desist from entering into non-compete agreements with its employees or enforcing any such agreements.  It would also require Rollins to provide notice to employees currently subject to non-compete agreements that Rollins will not enforce them.  The proposed order will be open for public comment for 30 days from the April 15th filing date. 

Alongside the FTC’s action against Rollins, the agency sent warning letters to thirteen other companies in the pest-control industry, instructing them to review their own employment agreements to ensure they do not have anticompetitive non-compete provisions.

The FTC’s complaint was filed in the wake of several major FTC actions concerning non-competes in recent years, most notably the Biden-era FTC’s non-compete rule, which declared most non-compete clauses an “unfair method of competition” under the FTC Act.  The non-compete rule was created as a result of notice-and-comment rulemaking, went into effect on May 7, 2024, and was later successfully challenged in two federal district courts.  Though the Biden FTC had been appealing each challenge, the FTC under Trump dismissed the appeals on September 5, 2025, abandoning any effort to salvage the rule.

While the now-abandoned Biden-era FTC’s non-compete rule took a broad approach to antitrust enforcement, the Trump administration’s FTC has used a scalpel rather than a hatchet, focusing on individual enforcement actions in targeted industries (for more information, see Falling Into the Void: Trump and Biden’s Incongruous Approaches to Antitrust Create a Guidance Vacuum).  And the Trump administration has elected for the FTC to act with a streamlined panel: President Trump fired the two democratic commissioners from the five-person commission in early 2025 and has failed to replace a republican commissioner who left her position late last year.

The case brought by Trump’s two-person FTC against Rollins is consistent with the FTC Chair’s 2025 directive establishing labor market enforcement as a policy priority.  As part of that directive, the Chair instructed the various FTC Bureaus to form a Joint Labor Task Force to share information and coordinate enforcement actions involving unfair labor market conditions.  The FTC has since sent letters to several health care organizations, urging them to review their employment agreements to ensure that they are “appropriately tailored to the circumstances,” though no enforcement action has been taken against those organizations. 

The FTC did bring labor market enforcement actions last year against a pet cremation company for its non-compete agreements and against a building services company for its no-poach agreements.  The final orders in both actions were authorized by the vote of only the two sitting commissioners.  A quorum of commissioners is met by a majority of members in office and not recused from a matter, so the two current commissioners, both republican appointees, may vote to take action on behalf of the Commission so long as they vote together.  In the meantime, President Trump has given no indication that the three open seats will be filled anytime soon, suggesting that the FTC will likely continue on the same trajectory of addressing non-compete agreements through focused enforcement actions for the foreseeable future.

Key Takeaways

• The Trump FTC has continued the bipartisan focus of maintaining competition in the labor market.
• Though the formal Biden-era non-compete rule has been abandoned, the FTC has demonstrated an intent to pursue targeted enforcement under the FTC Act for the use of broad non-compete language.
• The April 15th FTC complaint and proposed order against Rollins is the third FTC enforcement action based on restrictive employment covenants following the creation of the Joint Labor Task Force.
• The Trump FTC has focused on specific industries for enforcement against non-compete agreements; market participants in concentrated industries should review their employment policies for overly broad restrictive covenants and consult antitrust counsel with any questions.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.