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The case for banning non-competes

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Re: The case for banning non-competes

#31

Post by Buttons840 »

PragmaticPulp wrote: post #5

My state has severely limited non-compete agreements to the point that they’re only narrowly enforceable, if at all. That didn’t stop one of my previous employers from using non-compete scare tactics against employees. Many of us left in a large exodus when benefits and bonuses were cut and management made a number of other bad decisions. The company responded by sending remaining employees an e-mail with a list of c…

> Some others also went into hiding and lied on their LinkedIn profiles to prevent their old employer from finding out they went to competitors.

I avoid telling my employer where I'm going when I leave. There's simply no advantage to me to reveal that information. You can just say your quiting to take some personal time and deal with burnout. Perhaps that personal time is a 2 day weekend before your next job begins.

Re: The case for banning non-competes

#32

Post by tshaddox »

mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> Obviously, if I work as a developer making a stock trading app, I shouldn't be making a competing stock trading app after hours.

Why is that obvious? If I work as a studio musician can I also be working on my own album after hours?

Re: The case for banning non-competes

#33

Post by Teknoman117 »

I lived in Alabama for 4 years or so and at least at the time (I have no idea if it's changed since I left), their non-compete situation was garbage.

They were valid and enforceable even if you got laid off or fired. One of my friends' mother got laid off in the 2008 financial crisis from Bellsouth (or AT&T, I don't recall if the (re)merger was finished yet). She was told she couldn't work for any other telecom in the state for at least 18 months. She ended up going to stay with family in another state for that time so she could find another job, even though her husband and her son were in AL. It was a hard period for them.

I've had a hatred of non-competes since for the most part. If you (a company) are afraid of losing key talent, maybe you should actively try to retain it rather than turning your company into a prison.

Re: The case for banning non-competes

#34

Post by gibba999 »

ghaff wrote: post #11

I appreciate the gist of the article but IMO the CA/MA dichotomy (which is often mentioned--though MA significantly restricted non-competes a few years back) is facile. It's true that a lot of the new Internet/Web companies came out of California. And Apple is of course there as well. But the Route 128 companies mentioned in the article certainly traded employees, although in general employee tenures tended to be muc…

The more nuanced take is that different IP and employment laws benefit different industries.

Software benefits from no patents, limited-term copyrights, no NDAs, no non-competes, due to low cost-of-entry. Innovation is cheap but hard.

Pharma benefits from strong IP, NDAs, non-competes, etc. due to high capital investment levels. Innovation is easy but expensive.

Hardware varies.

Re: The case for banning non-competes

#35

Post by [deleted] »

mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

[deleted]

Re: The case for banning non-competes

#36

Post by 41209 »

gibba999 wrote: post #30
41209 wrote: post #26

Earlier quoted context omitted.

I'd still rather they be banned. Say you start as a junior at 80k , next year you get an offer for 150k , but you can't take it. You'd end up with a large 1 year resume gap, and losing 70k. The year of career stagnation wouldn't be worth it.

Or, you take a year to: - Get a Master's degree - Travel and see the world - Do consulting - Take a job in Indonasia - Teach - Develop a new open source project - Etc. The resume gap / career stagnation is a choice. It's rare that you can have a gap year like this. I totally don't feel bad about paid non-competes.

What if you have kids to provide for ?

You'd might rather have more money. If you desperately need to increase your income even paid non competes are a bad deal

Re: The case for banning non-competes

#37

Post by an_opabinia »

tshaddox wrote: post #32
mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> Obviously, if I work as a developer making a stock trading app, I shouldn't be making a competing stock trading app after hours. Why is that obvious? If I work as a studio musician can I also be working on my own album after hours?

> If I work as a studio musician can I also be working on my own album after hours?

Yes.

> Why is that obvious?

Just because there's a law somewhere that covers both a part of making music and part of making software, and just because some programmers make music and some musicians write software, and both are sometimes creative, doesn't mean they have much in common.

Re: The case for banning non-competes

#38

Post by lekanwang »

mountainriver wrote: post #12
PragmaticPulp wrote: post #5

My state has severely limited non-compete agreements to the point that they’re only narrowly enforceable, if at all. That didn’t stop one of my previous employers from using non-compete scare tactics against employees. Many of us left in a large exodus when benefits and bonuses were cut and management made a number of other bad decisions. The company responded by sending remaining employees an e-mail with a list of c…

What state is this?

This is a decent state-by-state overview of the enforceability of non-competes: https://www.wonder.legal/us/guide/what-is-the-enforceability...

Re: The case for banning non-competes

#39

Post by ghaff »

simcop2387 wrote: post #17
ghaff wrote: post #4

Earlier quoted context omitted.

Some people might think that was a good deal to travel the world but not everyone. So you're at the peak of your career and you need to take a couple years off at significantly lower total comp (because no bonus/equity).

This would mean that you can then also work in a related but not competing industry at the same time. It's not a no-work afterwords contract, but don't compete with us. that won't affect your total compensation then, or your career trajectory usually either. The idea is that a non-compete should only be used for someone it will actually matter to the business the, and not all the low level employees that don't have a…

So I'm a senior scientist at a pharma company. I want a new job. Cool. I can't take another pharma or biotech job but maybe I can go to coding camp and get a job mining people's data.

Re: The case for banning non-competes

#40

Post by WaitWaitWha »

EDIT: I have completely went off on the wrong thought path. As noted, despite reading the article and comments, somehow my mind got latched onto NDAs instead of NCAs. Sorry.

----

I will be the contrarian.

For those who insist on no NDA, what prevents ex-employees from spilling secrets to be hired at a competitor?

I understand the concerns with NDAs. I was under one which limited my work in a radius, and within a very broad field. Imagine having to leave the country to practice in my field. The owner threatened me when I left (with tiny droplets of spittle on my face from his screaming). This kind of NDA is horrible.

That said, NDAs are there to protect a company from ex-employees sharing competitive knowledge about a product or service, damaging or even shuttering a the company.

I will ask you to sign an NDA if you want to work for me. You are not going to directly compete against me in a specific sub-industry, you are not taking my clients, and you are not poaching my employees for a reasonable period. This NDA is presented prior you taking the job. Not all NDAs are "out to get the little guy".

Maybe NDAs need some precedent cases where overly broad NDAs are struck down.

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