When the FTC voted to ban most noncompetes in 2024, a lot of executives treated it as a legal problem. Then a federal court blocked the rule, and they exhaled. The real story is the state-level bans that kept coming. That should have forced a different conversation.
The panic exposed a retention gap
I've never kept a good engineer with a noncompete. I've kept them with problems worth solving, managers who listen, and pay that doesn't lag. But when the noncompete ground shifted, I watched directors ask legal for stronger language instead of asking themselves why people would stay. That's the trap. Restrictive covenants had become a substitute for management. The moment they weakened, the real engagement deficit showed up.
Mobility is the default now
In a state that banned noncompetes, one of my directors lost two senior data engineers in a quarter. He asked if we could enforce an out-of-state clause. I told him the contract wasn't the reason they left. He hadn't had a meaningful career conversation with either of them in 18 months. The ban didn't create the turnover; it exposed the silence.
The lesson isn't about legal compliance. It's about leading as if every employee has an offer in hand—because many do. Retention through restriction was always an illusion. Retention through decent management is harder but durable.
The takeaway
Stop drafting handcuffs. Audit your span of control for engagement debt the way you'd audit technical debt. If your retention strategy depends on someone not being allowed to leave, you don't have one.