21–30 of 242 posts
> But the history of these covenants suggests that there’s a strong economic case for banning them entirely This is an example of starting to make a good point and carrying to an extreme that makes it unreasonable. Non-competes exist for a reason, and saying they need to be deleted is a silly argument. "This common business practice could use modification" generates less clicks, I suppose.
Q: I'm willing to pay you $100,000 to sign a non-compete to work on the project with my company. If I don't pay, the non-compete isn't valid. Okay? A: No. Q: $500,000? A: No. Q: $1m? A: No. Q: $10m? A: Yes. The point being... the problem is NOT non-competes. The problem is the exchange of value. They serve a useful purpose in support of business risk-taking and investment. Make them fair, not unenforceable.
non competes are incompatible with free Enterprise, and incompatible with social democracy. yeah send them back
> But the history of these covenants suggests that there’s a strong economic case for banning them entirely This is an example of starting to make a good point and carrying to an extreme that makes it unreasonable. Non-competes exist for a reason, and saying they need to be deleted is a silly argument. "This common business practice could use modification" generates less clicks, I suppose.
non competes are incompatible with free Enterprise, and incompatible with social democracy. yeah send them back
A lot of people seem to think that "free enterprise" means that companies can do whatever they want and that that's somehow always good for employees. Same for "Right to Work".
Q: I'm willing to pay you $100,000 to sign a non-compete to work on the project with my company. If I don't pay, the non-compete isn't valid. Okay? A: No. Q: $500,000? A: No. Q: $1m? A: No. Q: $10m? A: Yes. The point being... the problem is NOT non-competes. The problem is the exchange of value. They serve a useful purpose in support of business risk-taking and investment. Make them fair, not unenforceable.
Terms become unenforceable when it's recognized by the courts that one party has so much negotiating power that true negotiations are impossible. A software engineer in the middle of SV might be able to demand $100k to sign a noncompete, but who else?
There's a myth that SV engineers can demand whatever they want and get it. No, they can't. If I get an offer for $200k, and that's actually my market value, and I demand another $100k for any reason whatsoever - I won't get them, period.
NCAs aren't legal in California, but if they were, and some smartass decided to demand another $100k cash to sign them, I guarantee he'd just get a pass, and someone less smartass would get the job instead.
One of the most insidious portions of non-competes IMO is that they are often non-enforceable. Depending on how wide or restricted the target of the non-compete is it can be ruled invalid. A lot of the more questioning people have probably discovered this but consider that there are probably janitors laid off by amazon who read their non-competes as the word of law and end up suffering hardships because of it. Also,…
Non-competes are illegal for physicians in my state, but I know of a case in which the clinic dragged the case out so much with various technicalities that eventually the Dr. settled. Now, in a subsequent case with a different defendant, lawyers are refusing to take the case for that reason. So the doctor in question is waiting for the non-compete to expire before retrying opening a private practice anywhere near their home again.
It's not enforceable legally, but they're doing so via other means.
Q: I'm willing to pay you $100,000 to sign a non-compete to work on the project with my company. If I don't pay, the non-compete isn't valid. Okay? A: No. Q: $500,000? A: No. Q: $1m? A: No. Q: $10m? A: Yes. The point being... the problem is NOT non-competes. The problem is the exchange of value. They serve a useful purpose in support of business risk-taking and investment. Make them fair, not unenforceable.
Terms become unenforceable when it's recognized by the courts that one party has so much negotiating power that true negotiations are impossible. A software engineer in the middle of SV might be able to demand $100k to sign a noncompete, but who else?
Q: I'm willing to pay you $100,000 to sign a non-compete to work on the project with my company. If I don't pay, the non-compete isn't valid. Okay? A: No. Q: $500,000? A: No. Q: $1m? A: No. Q: $10m? A: Yes. The point being... the problem is NOT non-competes. The problem is the exchange of value. They serve a useful purpose in support of business risk-taking and investment. Make them fair, not unenforceable.
This wouldn't be realistic even if non-competes were perfectly enforceable at low cost. An enforceable non-compete does not raise an employee's value to the employer, and anyways they would not be able to afford exorbitant salaries. Non-competes really do cost employees (who mostly act as though they are enforceable), and they seem to put up with it, and since they put up with this then in a sense it is already the c…
A friend of mine received two offers for almost the exact same compensation. One had a non-compete clause buried deep in the employment contract. Most candidates probably wouldn't even find it.
He asked what the non-compete means. They told him it's almost never enforced. As in, by the mere language, they could sue pretty much any employee who switched jobs.
So ask an independent lawyer to get an answer, right?
The lawyer told him it basically depends on the judge and the judicial climate if it ever goes to trial. Sometimes these cases get dismissed. Other times, the NCA is enforced.
Even if he wanted to negotiate, he couldn't. He doesn't know how much the clause is going to cost him. All the key information is missing, such as whether the company will actually sue, whether the "judicial climate" is right for the judge to side with the plaintiff or summarily dismiss the suit, etc.
It's the perfect example of "negotiations" being useless, especially for a weak uninformed party like a job candidate.