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Send Noncompete Agreements Back to the Middle Ages

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Re: Send Noncompete Agreements Back to the Middle Ages

#121

Post by cgriswald »

chii wrote: post #48
BonesJustice wrote: post #43

Earlier quoted context omitted.

60%? Forget that. Why should anyone give up their right to work for a little over half of their market value? There is no excuse for allowing less than 100% compensation, and that should include not just salary, but projected bonuses.

It's not like the specific job is the only thing you can do - there are other jobs that don't break the NC. 100% is too high, and 50% is too low. But the amount should be negotiable for each person.

It should probably be more than 100%. You don’t just miss out on salary. You miss out on raises and promotions, which might put you behind. You miss out on opportunities that may be gone with the NC period is over. Depending on the work, keeping your skills honed might be impossible from home.

The problem is that 60% is not about making you whole. It’s about discouraging NCs in general.

Re: Send Noncompete Agreements Back to the Middle Ages

#122

Post by cornellwright »

georgeecollins wrote: post #115
grellas wrote: post #49

Non-competes under U.S. law are neither all good nor all bad. They have their legitimate uses but these are the narrow cases and not the norm. For example, you sell a business to someone who pays you a big premium for your goodwill value usually tied to the value of the customer base. It is entirely fair that, having taken the money in exchange for the sale of your goodwill interest, you not be able to turn around th…

There are many incentives available to prevent the seller of a company (and the employees) to not run out and start a competitor. You can give them shares that vest over time. You can offer them employment in the new company. You can make various offers contingent on the performance of the sold company.

Given that these NCs are generally negotiated as part of the sale of the company I don't really see a problem. If what you're being offered isn't worth agreeing not to compete then keep negotiating or walk away.

Re: Send Noncompete Agreements Back to the Middle Ages

#123

Post by captainperl »

MrStonedOne wrote: post #95
cperciva wrote: post #68

Earlier quoted context omitted.

I don't see the connection. Right to Work laws say that workers can't be forced to join a union. They don't say that workers can't voluntarily join a union; so why should they say that workers can't voluntarily sign a non-compete?

Right to work laws say you have to a right to work or not work. That is why they are called right to work laws, and this is why the parent is making that observation, as NCA's are antithetical to right to work. Maybe trying reading in to things a bit more rather then jumping to the wrong conclusion?

> Right to work laws say you have to a right to work or not work.

No, they mean employees have a choice to join a union or not (ie. pay union dues or not.)

In other words, they're a legal tool to weaken unions by reducing their membership and revenue.

Re: Send Noncompete Agreements Back to the Middle Ages

#124

Post by grecy »

BonesJustice wrote: post #43
chris_engel wrote: post #30

Thank god the german law requires a NC clause to have a compensation directly mentioned in the contract that is not allowed to be less than 60% the person earned in the company in the last year she worked there. If the compensation is missing or too low, the NC is against the law. In other words: if a company wants me to not compete, they need to pay me for the time the NC is active. Its also limited to a maximum of…

60%? Forget that. Why should anyone give up their right to work for a little over half of their market value? There is no excuse for allowing less than 100% compensation, and that should include not just salary, but projected bonuses.

> 60%? Forget that. Why should anyone give up their right to work for a little over half of their market value?

Well, you could take the American option where you're not allowed to work in that field, so you get 0% of your salary... (California excluded, if I understand correctly)

Re: Send Noncompete Agreements Back to the Middle Ages

#125

Post by Wowfunhappy »

code_beers wrote: post #119
Wowfunhappy wrote: post #112

Earlier quoted context omitted.

> You are most valuable in a position that leverages your existing skills and expertise. Exactly. So per the non-compete, you'd have to take a position where you are only 40% as valuable as you could be—and the 60% noncompete makes up the difference.

So what, I’m only expected to bring 40% of my abilities to my next job? That makes mathematical sense, but it’s impossible in practice. It would be like trying to use 40% of your arms. If an honest engineer sees a problem which is exactly the same as one she solved at a previous company, and it is still the best solution, she will solve it in the same way. This has nothing to do with company secrets, it’s basic trade…

You're expected to do your best at your next job—but because it's not the most appropriate job for you, you're actual performance is probably some percentage less than what it could be elsewhere. This can in turn be an opportunity to diversify your overall skillset.

(I was of course being a bit facetious with the 40% metric—real life isn't quite so simple—but saying the noncompete should have 100% compensation is silly. That would only make sense if your ability to work was being completely taken away)

Re: Send Noncompete Agreements Back to the Middle Ages

#126

Post by wpietri »

stale2002 wrote: post #107
wpietri wrote: post #103

Earlier quoted context omitted.

Maybe. Or maybe they're willing to go to court, make you get a lawyer, drag you through discovery, depose you, set a court date to force you to prep for trial, and then offer to settle at the last minute. For a large company, that's a small amount of money and a modest amount of time. For the normal employee, it's a lot of unexpected expense, a great deal of stress for months, and the risk of owing a shit-ton of mone…

Sure. But it a company wants to sue you just for the hell of it, then whether or not you signed a non-compete is irrelevant. Maybe you negotiated this out of your contract, but they decide to sue you anyway. The better solution to all of this is not to "ignore" the non compete risk, it is instead be to simply lie to your former employer. What are they going to do? Hire a private investigator to track down all ex empl…

The notion is not that you get sued for the hell of it. It's that you get sued for commercial advantage. You get sued to make an example of somebody, so that all the employees know they'll ruin somebody if they find out they're working for a competitor.

That somebody has decent odds of getting away with something is only relevant if the punishment not terrible. But a 95% chance of not getting sued is not great if when you are sued it's $100k in expenses and two years of incredible stress.

Will some people do it anyhow? Sure. But most people won't, and that's what bullshit noncompetes are after.

Re: Send Noncompete Agreements Back to the Middle Ages

#127

Post by SoylentYellow »

Wowfunhappy wrote: post #125
code_beers wrote: post #119

Earlier quoted context omitted.

So what, I’m only expected to bring 40% of my abilities to my next job? That makes mathematical sense, but it’s impossible in practice. It would be like trying to use 40% of your arms. If an honest engineer sees a problem which is exactly the same as one she solved at a previous company, and it is still the best solution, she will solve it in the same way. This has nothing to do with company secrets, it’s basic trade…

You're expected to do your best at your next job—but because it's not the most appropriate job for you, you're actual performance is probably some percentage less than what it could be elsewhere. This can in turn be an opportunity to diversify your overall skillset. (I was of course being a bit facetious with the 40% metric—real life isn't quite so simple—but saying the noncompete should have 100% compensation is sil…

How is 100% compensation silly? Non-compete agreements restrict your ability to freely practice your craft. They are prone to being improperly applied or outright abused (see Jimmy John's audacious non-compete clause). This has happened so often that California practically outlawed them. The root of the problem is that a boiler plate non-compete clause in every employee contract costs nothing. The company can pick and choose when to enforce it, so why not include it? Requiring 100% compensation forces companies to justify the non-compete with their pocket book. This is a powerful feedback mechanism that balances restricting a person's basic rights with legitimate business needs.

Re: Send Noncompete Agreements Back to the Middle Ages

#128

Post by TheCoelacanth »

cperciva wrote: post #68
deogeo wrote: post #14

Odd that Right to Work laws don't ban non-competes. Edit: Added tags, just in case.

I don't see the connection. Right to Work laws say that workers can't be forced to join a union. They don't say that workers can't voluntarily join a union; so why should they say that workers can't voluntarily sign a non-compete?

> Right to Work laws say that workers can't be forced to join a union.

They say no such thing. They say that companies can't form agreements to exclusively hire union workers. They outlaw essentially non-competes in the opposite direction. A non-compete agreement binds a worker to exclusivity with a company. The agreements outlawed by right-to-work laws bind companies to exclusivity with a union.

Re: Send Noncompete Agreements Back to the Middle Ages

#129

Post by mirimir »

CoolGuySteve wrote: post #106
chii wrote: post #48

Earlier quoted context omitted.

It's not like the specific job is the only thing you can do - there are other jobs that don't break the NC. 100% is too high, and 50% is too low. But the amount should be negotiable for each person.

That doesn't stop companies from asserting that their non-compete is more broad than it is. Once they do, no other company is going to risk having you work for them while that illegally-broad non-compete is in effect. You can sue but it's so expensive you probably won't and the company knows it.

That can happen even without a formal noncompete agreement.

Re: Send Noncompete Agreements Back to the Middle Ages

#130

Post by maerF0x0 »

BonesJustice wrote: post #43
chris_engel wrote: post #30

Thank god the german law requires a NC clause to have a compensation directly mentioned in the contract that is not allowed to be less than 60% the person earned in the company in the last year she worked there. If the compensation is missing or too low, the NC is against the law. In other words: if a company wants me to not compete, they need to pay me for the time the NC is active. Its also limited to a maximum of…

60%? Forget that. Why should anyone give up their right to work for a little over half of their market value? There is no excuse for allowing less than 100% compensation, and that should include not just salary, but projected bonuses.

60% for a year off? And you can return to 100% afterwards... Many americans would love that offer.
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