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On Sept. 5, 2025, the Federal Trade Commission (FTC) voted to dismiss its appeals in two legal challenges of the FTC’s 2024 final rule to prohibit employers from using noncompete clauses with most employees. In 2024, the FTC appealed two separate court rulings regarding the noncompete ban, including one vacating the noncompete ban for all employers. Following the FTC’s dismissal of its appeals, the noncompete ban remains vacated for all employers.
On May 7, 2024, the FTC published a final rule prohibiting employers from entering into or enforcing noncompete clauses with most employees and requiring employers to notify employees that their noncompetes would not be enforced (subject to limited exceptions).
Currently, the enforceability of noncompete clauses is determined by state and local legislatures and courts. The FTC rule would have instead governed the enforceability of noncompete clauses at the federal level and superseded any less restrictive state laws or judicial interpretations.
In Ryan LLC v. FTC, the plaintiffs argued that the noncompete ban should be vacated because it exceeds the FTC’s statutory authority, is unconstitutional, and is the product of arbitrary and capricious decision-making. On Aug. 20, 2025, the U.S. District Court for the Northern District of Texas issued a final ruling in Ryan agreeing with the plaintiffs’ arguments and holding that “the FTC lacks statutory authority to promulgate” the noncompete ban and the ban “is arbitrary and capricious.” Under the ruling, the noncompete ban was permanently blocked for all employers nationwide.
In addition to the Ryan case, on Aug. 15, 2025, the U.S. District Court for the Middle District of Florida issued a preliminary injunction of the noncompete ban, which blocked the enforcement of the ban only with respect to the plaintiff in Properties of the Villages v. FTC.
The FTC filed appeals in the Ryan case on Oct. 18, 2024, and in the Properties of the Villages case on Sep. 24, 2024. However, on Sept. 5, 2025, the FTC voted to withdraw its appeals in both cases. Therefore, the noncompete ban will remain vacated in its entirety for all employers nationwide.
While the FTC’s noncompete ban never took effect, employers were previously left with uncertainty as to whether the ban would ultimately take effect. Now that the FTC has withdrawn its appeals, employers have more certainty that the ban will not take effect, and employers may continue to rely on state-level guidance regarding the enforceability of noncompetes. In addition, the FTC chairman stated that the agency will continue enforcement efforts against unlawful noncompetes. Therefore, employers may wish to review existing noncompete agreements to ensure compliance with existing laws.
On Sept. 24, 2025, the U.S. Department of Homeland Security (DHS) announced a proposed rule amending its regulations governing the process by which the U.S. Citizenship and Immigration Services (USCIS) selects H-1B registrations. The proposed rule would implement a weighted selection process that would generally favor higher-skilled and paid foreign workers.
The proposed rule follows a recent presidential proclamation, signed on Sept. 19, 2025, announcing a new $100,000 entry fee for each new H-1B visa recipient starting Sept. 21, 2025. According to the Trump administration, the increased fee aims to curb abuses of the H-1B system that may disadvantage the U.S. workforce and lead to wage suppression. The proclamation does not change any required fees in connection with H-1B renewals. More information about the new fee can be found on the U.S. Department of State’s website.
The current H-1B visa program allows U.S. employers to hire foreign workers in specialty occupations requiring highly specialized knowledge. Each year, the USCIS allocates 65,000 slots for regular H-1B registrations and 20,000 slots for individuals with a U.S. master’s degree or higher. Employers apply by submitting an electronic registration for each candidate they sponsor. The USCIS conducts a random lottery if the number of registrations exceeds the limited H-1B quota.
The proposed regulation would replace the lottery system with a weighted system prioritizing higher-paying jobs while still awarding H-1B visas at different wage levels. The proposal identifies four wage bands based on the Occupational Employment and Wage Statistics wage levels, as follows:
• Level I—Candidates would be entered into the selection pool one time;
• Level II—Candidates would be entered into the selection pool two times;
• Level III—Candidates would be entered into the selection pool three times; and Level IV—Candidates would be entered into the selection pool four times.
Candidates would only be eligible to be selected one time, regardless of the number of entries, through a random, computer generated selection process.
The U.S. Department of Labor (DOL) has released revised model notices for initial adverse benefit determinations, appeal denials and external review decisions. The models have been revised to include taglines in applicable non-English languages to reflect the most recent Culturally and Linguistically Appropriate Services (CLAS) County Data. The revised models also have a new expiration date of Aug. 31, 2028.
Federal regulations require employee benefit plans to establish and maintain reasonable procedures for filing benefit claims and appeals, making claims and appeals decisions, and notifying claimants of benefit decisions. Plans that are covered by the Employee Retirement Income Security Act (ERISA) must provide timely notice of initial benefit denials and any subsequent denials upon appeal. Non-grandfathered group health plans and issuers must also comply with external review requirements under the Affordable Care Act.
To support compliance, the DOL has long provided model notices for initial adverse benefit determinations, appeal denials and external review decisions for use by plan sponsors and issuers. In November 2023, the DOL issued FAQs announcing its intent to update the model notices to reflect 2023 CLAS County Data, applicable to plan years beginning on or after Jan. 1, 2025.
The following updated model notices are now available:
• Revised Model Notice of Adverse Benefit Determination;
• Revised Model Notice of Final Internal Adverse Benefit Determination; and
• Revised Model Notice of Final External Review Decision (also available in Spanish).
These revised templates are designed to help plans and issuers meet federal notice requirements while ensuring accessibility for individuals in counties with significant non-English-speaking populations.
Additional resources and the updated model notices can be found on the DOL’s Internal Claims and Appeals and External Review webpage.
Nothing to report for this month…
10/1 – QSEHRA Notice Deadline (Calendar Year Plans Only)
10/15 – Medicare Part D Creditable/Noncreditable Coverage Notice
10/31 – Form 941 Filing Deadline for Q3
Nothing to report
12/31 – Gag Clause Prohibition Compliance Attestation – group health plans and health insurers
Lighthouse HR Support (LHRS) provides practical human resource information and guidance based upon our knowledge and experience in the industry and with our clients. LHRS services are not intended to be a substitute for legal advice. LHRS services are designed to provide general information to human resources and/or business professionals regarding human resource concerns commonly encountered. Given the changing nature of federal, state and local legislation and the changing nature of court decisions, LHRS cannot and will not guarantee that the information is completely current or accurate. LHRS services do not include or constitute legal, business, international, regulatory, insurance, tax or financial advice. Use of our services, whether by phone, email or in person shall indicate your acceptance of this knowledge.
