The FTC’s April 15, 2026 enforcement action against Rollins, Inc. should be viewed less as an isolated dispute over non-compete agreements and more as a roadmap for future federal enforcement. For multistate employers, the case reveals not just what the FTC is challenging, but how it is reframing non-competes as a structural competition issue rather than a contract enforceability question.

Background of the Enforcement Action

According to the FTC complaint, Rollins operates more than 700 locations nationwide and employs more than 18,000 U.S.-based workers. The company maintained a longstanding policy requiring virtually all newly hired employees, regardless of their role, responsibilities, or access to confidential information, to enter into post‑employment non-compete agreements.

The challenged non-compete provisions typically restricted employees, for two years after the end of their employment, from working in the pest control industry within 75 miles of their work location. The FTC alleged that the vast majority of Rollins’ workforce — including customer service representatives and pest control technicians — was subject to these restrictions.

On April 15, the FTC and Rollins published their Consent Agreement to resolve the complaint.  In it, Rollins consented to an injunction that prohibited them from, among other things:

• Entering into, or enforcing non-compete agreements against employees who are not senior leaders; 
• Communicating to employees that they are subject to a non-compete agreement; and
• Enforcing the customer non-solicitation against employees engaging in general distributed notices or announcements for a business that competes with Rollins or responding to inquiries initiated by a customer.

In addition, the consent agreement required Rollins to inform employees, in writing, that its non-compete agreements were no longer enforceable.

The FTC is Recasting Non-competes as a Market-Structure Problem

A critical feature of the Rollins complaint is how the FTC framed the non-competes used by Rollins. The FTC does not treat non-competes as an individual employment issue, but as a mechanism that distorts labor market competition at scale.

The agency repeatedly emphasized:

• The number of employees affected (18,000-plus);
• The uniformity of the restrictions; and
• The aggregate effects on wages, mobility, and competitive entry.

This is a deliberate shift. Rather than litigating whether a given non-compete is “reasonable,” the FTC asserted that the systemic use of non-competes, even if compliant with state law, can function as an unfair method of competition.

Uniformity is a Liability, Not a Defense

Historically, employers have favored uniform restrictive covenant programs to:

• Ensure consistency;
• Reduce administrative burden; and
• Avoid uneven enforcement risks.

Ironically, Rollins shows that uniformity is now an enforcement trigger. The FTC emphasized that the uniform non-compete program relied upon by Rollins was an essential component of its liability. Specifically, the FTC pointed to the following:

• Non-competes were required for virtually all employees;
• Agreements were imposed without regard to role, seniority, or competitive exposure; and
• Restrictions were geographically broad and long in duration.

These facts allowed the FTC to argue that:

• The restrictions were not tied to legitimate business needs; and
• Could not be justified as narrowly tailored protections.

Enforcement Conduct Now Matters as Much as Contract Language

One of the more consequential aspects of the Rollins complaint is the attention paid to how the company enforced its non-competes. The FTC highlighted:

• Hundreds of cease‑and‑desist letters;
• Repeated litigation against former employees; and
• The imbalance of resources between Rollins and individual workers.

This matters because it allowed the FTC to frame enforcement itself as coercive conduct, even where litigation may have been legally permissible under state law.

State Law is a Floor, Not a Shield

Perhaps the most important takeaway for multistate employers is that state‑law enforceability is no longer dispositive. The FTC’s theory explicitly assumed that non-competes:

• May be lawful under state contract law;
• Still constitute an “unfair method of competition” under federal law.

This creates a layered compliance environment:

• State law governs whether an agreement can be enforced in court.
• Federal law governs whether using the agreement at all is permissible at scale.

For multistate employers, this represents a fundamental paradigm shift. Compliance strategies that often focus on state‑specific drafting must now include an assessment of potential federal antitrust risk.

The FTC is Signaling Preferred Alternatives

The Rollins complaint does more than criticize non-competes; it explicitly endorsed alternatives, including:

• Confidentiality agreements;
• Trade secret protections; and
• Narrowly tailored non‑solicitation provisions.

Importantly, the FTC does not merely suggest these alternatives, it alleges that Rollins did not need non-competes at all to protect its interests.

Strategic Implications for Multistate Employers

The FTC made clear that the more a company relies on national templates, standardized onboarding, and centralized enforcement, the more easily the FTC can argue competitive harm across labor markets. This means that multistate employers should assume the more “plug‑and‑play” their non-compete program is, the more vulnerable it is to federal scrutiny — regardless of whether it complies with any single state’s law.

Further, employers using aggressive enforcement tactics can now be cited as evidence that non-competes suppress mobility and competition — even if the underlying agreement is never adjudicated unlawful  This framing puts employers in a difficult position: Not enforcing non-competes undermines their deterrent value, while engaging in systematic enforcement may increase regulatory exposure.

Finally,  the FTC is likely to argue in future enforcement actions that employers that could use less restrictive tools, but choose not to, are acting unreasonably, regardless of historical practice. This places increased pressure on employers to justify, first, why non-competes are necessary; second, for which roles they are necessary; and third, why more narrowly tailored alternatives would be insufficient.

What Multistate Employers Should Be Doing Now

From a risk‑management perspective, the Rollins action suggests employers should move beyond simple contract audits and toward program‑level redesign:

• Segment, Don’t Standardize: Differentiate restrictive covenants by role, seniority, and access to sensitive information, and avoid blanket application at hiring.
• Reassess Enforcement Strategy: Implement centralized review before sending cease‑and‑desist letters, and track enforcement patterns to avoid appearing punitive or systematic.
• Strengthen the Business Rationale: Document why specific roles require post‑employment restrictions, and be prepared to explain why non-competes, rather than alternatives, are necessary.
• Prepare for Federal Review: Assume non-competes may be examined by regulators, not just courts, and align HR, legal, and compliance teams on a unified approach.

Conclusion

The FTC’s action against Rollins sends a clear message to multistate employers: Expansive non-compete programs are no longer evaluated solely through the lens of state contract law. Federal antitrust enforcement is now a central risk consideration. Employers should proactively audit restrictive covenant agreements, reassess whether non-competes are truly necessary, and consult counsel to align employment practices with this evolving enforcement environment.

If you have questions about non-compete agreements, please contact your UBG attorney or Chris Pickett at cpickett@ubglaw.com.

The information provided in this alert speaks only to the information and guidance we have available as of the date of publication and is subject to change. This legal update was created by UB Greensfelder LLP and is not intended as a substitute for professional legal advice. Receipt, by itself, does not create an attorney-client relationship. For any questions, or for further information, please contact your UB Greensfelder attorney.