NLRB Advice Memo Concludes Noncompete Agreements Do Not Violate The National Labor Relations Act

Under the National Labor Relations Act (the Act), specifically Section 8(a)(1), it is considered an unfair labor practice (ULP) for an employer “to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7” of the Act. Section 7 guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”

In a recent advice memorandum, published on June 26, 2026, the National Labor Relations Board (NLRB) Division of Advice departed from the former NLRB General Counsel’s 2023 position (taken during the Biden administration) that overbroad noncompete agreements may violate the Act because they purportedly chill employees from exercising their Section 7 rights. The Division of Advice was asked to opine whether noncompete agreements violated the Act, as alleged in charges filed by two former employees who began working for a competitor. The Division of Advice concluded that the noncompete agreements did not violate the Act, stating that the current “General Counsel is of the view that non-compete agreements do not as a general matter impact employees’ rights under Section 7. Accordingly, the non-compete language [under review] does not violate Section 8(a)(1).” The advice memo, which is not legally binding, recommended dismissal of the charges.

Although the advice memo may deter the filing and/or NLRB prosecution of ULP charges based on noncomplete agreements (at least under the current presidential administration), it does not dictate the enforceability of noncompete agreements, which is governed primarily by applicable state law. See our recent July 13, 2026, article, “Noncompete Agreements in 2026: A Federal and State Overview” for an overview of the current noncomplete landscape. Employers, therefore, should regularly review their restrictive covenant agreements to help ensure they are enforceable under applicable law.