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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

#151

Post by jaredklewis »

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…

In theory, I see nothing wrong with them.

Non-competes ask employees to give up something extremely significant: freedom to work there they choose. Which I have no problem with if they get something significant in exchange.

Let's an employer wants some insurance that I won't go work elsewhere because there is going to be a long training period or what not. I expect significant compensation for that, ideally in the form of a large signing bonus, maybe 50k per year of non compete.

Don't want to pay 50k in cash up front per year of non compete? Take out the non compete. Simple negotiation.

I guess the problem in practice is that employees just sign their employment contract no matter what it says, which is unfortunate.

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

#152

Post by GavinMcG »

throwaway_exer wrote: post #13
ekianjo wrote: post #11

Earlier quoted context omitted.

> California also prohibits any employee agreement which claims employer ownership of intellectual property developed on the employee's own time I have always wondered how could such a claim on ownership could exist in the first place. This reduces the employee to a mere company slave.

> This reduces the employee to a mere company slave. Generally law enforcement will treat an employee as a slave if a company files any kind of complaint statement against the employee, regardless of how small the company is. Also, former employees have been convicted of violating employee handbooks. So slave is an apt description.

Can you please point to some examples of where employees were convicted of a crime simply for violating the private policies of their employer?

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

#153

Post by raverbashing »

jaredklewis wrote: post #151
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…

In theory, I see nothing wrong with them. Non-competes ask employees to give up something extremely significant: freedom to work there they choose. Which I have no problem with if they get something significant in exchange. Let's an employer wants some insurance that I won't go work elsewhere because there is going to be a long training period or what not. I expect significant compensation for that, ideally in the fo…

Correct. You want me to "non compete" with you? Pay me either a bonus or a salary (90% is fine) during the non-compete period

Apart from that please shove your non-compete there

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

#154

Post by elcct »

michaelmrose wrote: post #145
elcct wrote: post #129

Earlier quoted context omitted.

This is a good question. I think if you were offered better salary, the former company should either match it or let you take new contract.

This is sensible but its a lot easier just to make non competes go away entirely.

In the end if there is no compete clause in your contract, you can just not take it...

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

#155

Post by TeMPOraL »

Silhouette wrote: post #112
elcct wrote: post #105

Earlier quoted context omitted.

Non compete is fine if you were paid full salary for the entire time.

Which full salary, the one you got before, or the one you could make as a skilled software developer moving to a much better gig with a rival employer willing to offer a more attractive deal?

Depends. I'll happily take my old salary for just sitting on my butt and not doing anything. Of course, I would not be sitting like that - I'd probably take a part-time job somewhere else, and spend the rest of the time educating myself (for my field as well as for other things). Non-competes don't cover reading books.

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

#156

Post by nothrabannosir »

tjic wrote: post #146
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…

> 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. To go meta for a moment: I think that this sort of statement exposes a flaw that many of us have in debates. It's related to the "argument from ignorance" fallacy, but is not exactly the same thing. I take it as one of my priors that people at news.yc are intelli…

1) deontological: freedom to contract is always a good thing. It is a human right, and government has no legitimate moral power to remove that right from people.

That's not a strong argument either. You could substitute "contract" with anything. I say this as a staunch libertarian. Government restrictions aren't bad because "government", but because restrictions.

The free market works best when government restricts the freedom to restrict freedom. That's why cartels being illegal is good (they restrict competition), bans on insider trading are good (they restrict fair competition), etc. Non-compete restricts the freedom on the labor markets.

If you let people do anything they want because freedom, you don't actually get freedom.

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

#157

Post by michaelmrose »

nickff wrote: post #87
greglindahl wrote: post #63

Earlier quoted context omitted.

You can imagine many things, but can you point to any evidence? Many people write blog postings about non-competes; I can't recall a single one where extra money was attached.

If you agree with my supposition that forcing an employee to choose the lower-paying job with bad hours would make the agreement anti-employee, we should look at evidence of whether non-competes are paid for by employers. If you disagree with my supposition, we should address that first, as the rest of the argument depends entirely on that. My first piece of evidence for the proposition that employers pay for non-com…

The fact that employers value non competes as assets tells you that a) decreased turnover saves money b) employees who can't as easily leave require smaller/fewer incentives to stay

In fact its trivial to show that non competes result in depressed wages. It in fact shows you the exact opposite of what you intend to show. Non competes are valued as assets as it enables employers to pay employees LESS than in a free market.

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

#158

Post by dozzie »

tjic wrote: post #146
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…

> 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. To go meta for a moment: I think that this sort of statement exposes a flaw that many of us have in debates. It's related to the "argument from ignorance" fallacy, but is not exactly the same thing. I take it as one of my priors that people at news.yc are intelli…

1) and 2) both go out of the window if you add to the equation this little fact that company almost always has an upper hand over a single (soon-to-be) employee. Freedom of contract would be "always a good thing" if the parties held the same power in their relationship.

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

#159

Post by michaelmrose »

nickff wrote: post #99
greglindahl wrote: post #98

Earlier quoted context omitted.

Sorry, I don't agree with how you approach the entire problem. Labor law exists mainly because there's information asymmetry between companies and employees. You seem to be presuming that there's a free market for labor; that's not the case when there's information asymmetry. Your "evidence" falls apart when there's information asymmetry.

I think it is well known that there is information asymmetry in every transaction/deal/agreement involving more than one individual; saying that there is information asymmetry proves nothing. There is a highly regulated market for employees, and for employers. I didn't provide any evidence at all; I just asked if you agreed that in certain situations, it was possible for a non-compete ban to be anti-employee.

It can't be anti employee. Employers don't pay more for employees with non competes they pay less. In the case of the fictional employees you mentioned previously both employers would have faced a more competitive market for employees resulting in higher wages.

The non compete is nearly entirely valuable in that it it depresses wages. In reality its entirely likely that between firm A and firm B neither has a whole lot of special sauce non competes mostly serve to keep each other from competing for employees thus driving up wages.

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

#160

Post by walshemj »

ekianjo wrote: post #11
Animats wrote: post #4

Note that this is being proposed as something states should do. Federal legislation is not being proposed. Worst case would be Federal legislation which was weak and pre-empted state legislation, weakening California's ban. California employment law prohibits non-compete agreements for employees, and has since 1872. California also prohibits any employee agreement which claims employer ownership of intellectual prope…

> California also prohibits any employee agreement which claims employer ownership of intellectual property developed on the employee's own time I have always wondered how could such a claim on ownership could exist in the first place. This reduces the employee to a mere company slave.

It's derived (for anglo saxon based systems) from the common law governing "masters and servants" guess what we are
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