For a number of years WWE have inserted non-compete clauses into the contracts of their talent. This means that when a star is released they are unable to work elsewhere for an agreed period. This is usually 90 days on the main roster and 30 days for NXT stars, although this can vary.
However, if the United States Federal Trade Commission have their way the clauses could soon be a thing of the past. The body has proposed a new rule that would ban employers from utilising such clauses in their contracts with workers. It is surmised that this could see wages rocket by as much as $300 billion per-year and increase career opportunities for 30 million Americans.
Huge Changes Potentially Coming To WWE Contracts
The commission are pushing for the change on the basis that non-compete clauses violate Section 5 of the Federal Trade Commission Act.
“The freedom to change jobs is core to economic liberty and to a competitive, thriving economy,” said Chair Lina M. Khan. “Noncompetes block workers from freely switching jobs, depriving them of higher wages and better working conditions, and depriving businesses of a talent pool that they need to build and expand. By ending this practice, the FTC’s proposed rule would promote greater dynamism, innovation, and healthy competition.”
The proposed rule would make it illegal for an employer to:
- enter into or attempt to enter into a noncompete with a worker;
- maintain a noncompete with a worker; or
- represent to a worker, under certain circumstances, that the worker is subject to a noncompete.
Importantly the rule would apply to independent contractors, and anyone who works for an employer. WWE have famously insisted that their talents are “independent contractors.” However, the proposed ruling would not affect other restrictions such as non-disclosure agreements.
Although non-compete clauses have been a staple of WWE contracts, the new rule could also affect AEW. As well as potentially getting their hands on rival stars quicker, it was also noted in October that CM Punk’s exit from the company was being held up by wrangling over a non-compete period.