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White House urges ban on non-compete agreements for many workers

reuters.com

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Re: White House urges ban on non-compete agreements for many workers

#131

Post by bkor »

DominikR wrote: post #85

I wonder what a principled position on this matter would be. On one hand everyone is free to trade freedoms for gains (usually monetary - every contract restricts both parties freedom), but on the other hand you can't trade certain freedoms away that we view as fundamental. Even though I am certainly no proponent of non-compete agreements I cautiously tend towards viewing such contracts as acceptable and valid. You u…

It's not a fair negotiating position. If a company wants everyone on a non-compete, they'll be able to do so without providing any benefit for almost all employees.

I've had a company try and add a non-compete to a contract. They're generally not valid where I live, but it is always a hassle between having rights and getting that right. So I crossed it out of the contract (legal thing to do). That was a first for that HR, but it was accepted.

Note: talking in general. There might be exceptions in certain situations. E.g. CEO/strategic level functions or in case the salary is continued for the length of the non-compete period in case of not being able to find work (Belgium law ensures half of the salary).

Re: White House urges ban on non-compete agreements for many workers

#132

Post by distances »

dagss wrote: post #127
cgag wrote: post #122

Earlier quoted context omitted.

I also don't understand how using company property justifies ownership of intellectual work. What about using a company pencil should give you the right to any sketches I produce with it?

When the company purchases equipment for use by you-as-employee, and you use that equipment for your own company spare time, how is that fair? A pencil is so cheap and undetectable that it makes a poor example, but if you stole my paint and painted a picture I would expect some compensation?

Up to the value of the paint only. If Leonardo had painted Mona Lisa with stolen colours, no-one would expect the painting itself to be ownership of the paint merchant.

Re: White House urges ban on non-compete agreements for many workers

#133

Post by tristor »

nickff wrote: post #28
aikah wrote: post #26

Earlier quoted context omitted.

> I think that the idea behind such employee agreements is that they encourage the sharing of new ideas within companies, as employees will not 'hold the ideas back' to use when they go off and start their own companies. It's up to the company to provide incentive for workers to "share new ideas" by rewarding innovation within the company, not limiting where the employee can work. Of course, most companies don't do t…

The company thinks it is providing incentive for the employees to share the new ideas by paying their wages; their argument would be that if a prospective employee disagrees with the assessment of the value of the work and ideas, that individual should not accept the agreement.

That argument is flawed because an offer of employment is based on current and future expected value in a job role, not on unexpected new value that gets added by non required innovation. New ideas which bring new value should entitle an employee to additional new compensation if the company wants to claim ownership of those ideas regardless of where they are made.

Re: White House urges ban on non-compete agreements for many workers

#134

Post by codeonfire »

greglindahl wrote: post #76
codeonfire wrote: post #64

Earlier quoted context omitted.

Non-compete lawsuits are typically only worth it for VP level people who have strategic secrets. No one cares about or sues 99.9% of workers who go work somewhere else.

I agree that when it hits the news it's generally a lawsuit against a VP, but you have no idea how many times lawyers send nasty letters, which are pretty effective.

Yep, letters cost almost nothing to send. Almost all employees have nothing to worry about for one reason. The corp will not go ahead with a lawsuit because the employee will almost always have no money or assets to take. It's amazing how pathological corporate behavior becomes when one views it from the money perspective.

Re: White House urges ban on non-compete agreements for many workers

#137

Post by yomly »

telefonica wrote: post #24
aikah wrote: post #16

I don't understand how these clauses are even legal at first place. It violates the basic right of freedom of work. You can't have on one end freedom of enterprise but on the other hand no freedom of work for employees. the worst thing is the fact that these agreements usually come with 0 compensation.

Completely agree. In the UK it's called garden leave: the employer pays you to drink tea in your garden. It's too easy for companies to claim losses from competing employees. They need to put their $$$ where their mouth is

In the UK you're usually paid full salary though and garden leave is rarely longer than 3 months iirc.

Re: White House urges ban on non-compete agreements for many workers

#138

Post by user5994461 »

tajen wrote: post #116
aikah wrote: post #16

I don't understand how these clauses are even legal at first place. It violates the basic right of freedom of work. You can't have on one end freedom of enterprise but on the other hand no freedom of work for employees. the worst thing is the fact that these agreements usually come with 0 compensation.

> with 0 compensation I don't agree compensation would be any useful. In France non-compete agreements must be compensated proportionnaly. Example: My company prohibited me from working with the customers on the whole territory of France for a duration of 3 months, paid at 1/3 of the salary per month. The real mean clause is that they can decide whether to apply it or not, and they can tell you on the day you leave.…

From I recall from past French cases. 33% is not enough to enforce a non compete. That won't held in a court.

Re: White House urges ban on non-compete agreements for many workers

#139

Post by tristor »

I don't understand why there's so many people in the comments defending non-competes. They have literally no value to society, or to individual employees. They are a tool of restrictive coercion to stifle an employees freedom of movement in the job market.

Trade secrets, IP, secret sauce: covered by NDA and IP assignment agreements

Client lists, contract terms, sales strategies, reported metrics, financials: covered by NDA and in some cases SEC regulations about insider trading.

Etc.

The only thing a non-compete does is say that Employee A cannot work in their chosen field for some period of time after they are fired or quit. In doing so it offers no consideration or compensation typically in the contract.

So your employer underpays you by 40% and treats you badly? You want to leave for greener pastures at that hip new startup that offered you a Senior Engineer gig? Well, sorry to say you have a mortgage, a wife, and 2 kids and that non-compete says you are only legally allowed to be a burger flipper for two years after quitting, that software engineering is verboten.

Totally fair right?

If you don't sit on the board of a Fortune 500 company, you have literally no incentive to support non-competes. There is no rational basis to argue in their favor. Please learn the difference between NDAs, IP assignment agreements, and non-competes before lending non-competes some mystical powers they don't have.

Re: White House urges ban on non-compete agreements for many workers

#140

Post by masklinn »

tristor wrote: post #139

I don't understand why there's so many people in the comments defending non-competes. They have literally no value to society, or to individual employees. They are a tool of restrictive coercion to stifle an employees freedom of movement in the job market. Trade secrets, IP, secret sauce: covered by NDA and IP assignment agreements Client lists, contract terms, sales strategies, reported metrics, financials: covered…

> The only thing a non-compete does is say that Employee A cannot work in their chosen field for some period of time after they are fired or quit. In doing so it offers no consideration or compensation typically in the contract.

Many (if not most) EU countries require compensation for non-competes to be valid (usually at least 30% gross), and the non-compete can still be challenged in court if e.g. it applies to too large a geographical area (e.g. the entire state/country) or if it's broad enough to prevent the employee from finding work in the field.

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