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Laws barring noncompete clauses spreading

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Re: Laws barring noncompete clauses spreading

#171

Post by DangitBobby »

yardie wrote: post #160
kennend3 wrote: post #76

Earlier quoted context omitted.

Here (Canada) the courts almost always rule that the non-compete is unenforceable. The core issue is the rights of an individual to earn a living supersedes the rights of a corporation. https://globalnews.ca/content/8363992/can-non-compete-clause... " The majority of non-compete clauses challenged in the judicial system have been rendered unenforceable. Canadian courts, in my experience, look unfavourably on clauses…

I wonder what the cross-section of the population is smart enough to be worth making sign a non-compete yet not smart enough to do a basic Google search on their enforceability.

A lot of people are good natured and just take others at their word.

Re: Laws barring noncompete clauses spreading

#172

Post by coding123 »

paxys wrote: post #40

Over the years so many different jurisdictions around the US and the world have stated their desire to be the "next Silicon Valley" and have poured an immense amount of money and effort to make it so, whether in the form of incentives for businesses, tax breaks, education, job training, or even just straight paying smart people to move there. Every such scheme has generally failed because they refused to emulate the…

(it's actually just the weather)

Re: Laws barring noncompete clauses spreading

#173

Post by lazide »

michaelmrose wrote: post #167
lazide wrote: post #144

Earlier quoted context omitted.

If it was different, then he would have been fine once he was fired no? But that is not the case.

If he wants to quit and compete with you he should be able to even if this destroys your business. The problem is he used his access while employed to redirect customers. It wasn't fine after he was fired not because it wasn't ok for him to compete with his prior employer but because he had already swiped your customer base. The prior behavior and challenges after he left are inextricably intertwined. Him quitting di…

I think you might want to re-read things a bit.

1) It wasn't my business, and I'm not sure why you seem to think it was.

2) He only started the business because he was able to siphon off customers, and felt it was easy money.

3) If he had quit, and started his own business (even based on the prior one), and started from scratch, that wouldn't have been a problem. Him waiting a period of time (non-competes pretty much HAVE to be time limited to hold up anywhere) would not likely have changed it either.

But that would have required more work and more risk.

It's rare that folks actually do that.

Re: Laws barring noncompete clauses spreading

#174

Post by karthikb »

bdw5204 wrote: post #127
paxys wrote: post #40

Over the years so many different jurisdictions around the US and the world have stated their desire to be the "next Silicon Valley" and have poured an immense amount of money and effort to make it so, whether in the form of incentives for businesses, tax breaks, education, job training, or even just straight paying smart people to move there. Every such scheme has generally failed because they refused to emulate the…

I'm fine with allowing non-competes as long as the company pays the ex-employee their full salary for the length of the non-compete and can't rescind the non-compete without mutual consent. For example, an 18 month non-compete would mean 18 months of paid vacation after you leave a job. I imagine this would be functionally equivalent to a ban on non-competes because it seems like it'd be an insane waste of money but…

> I see no reason to stop them

This sort of a non-compete would almost have certainly resulted in Zoom not being built.

Re: Laws barring noncompete clauses spreading

#176

Post by aidenn0 »

shadowgovt wrote: post #12
matsemann wrote: post #8

Where I live (Norway), these laws came thanks to unions. When I graduated, all developer jobs I was offered had a noncompete clause in the contract. These were wide and potentially career-altering if enforced, barring you from doing basically any kind of work for long stretches of time. All companies when pushed basically said "ohh, we seldom enforce them, only for upper management", but still they insisted on them b…

I had a chance to visit Norway recently, and this was something that a tour guide impressed upon us about the culture; she gave an example of a restaurant in town that was caught skimming pay, and it wasn't just a union representing restaurant workers they heard from; they found themselves unable to find someone to repair plumbing or their storefront (the plumbers and glaziers wouldn't work with them), and their ingr…

While that does occasionally happen in the US as well, it's illegal (both general strikes and sympathy strikes were banned by Taft-Hartley).

Re: Laws barring noncompete clauses spreading

#177

Post by aidenn0 »

drogus wrote: post #53

In Germany in order for a non-compete agreement to be valid a company has to pay an employee money for the non-compete period. 50% of an average of last 3 months of employment. With this law I would be actually quite happy for a company to include a non-compete clause in the contract.

It would be financially devastating for me to halve my salary for a year; perhaps if the non-compete weren't too broad, I could make some of that up with contract work, but I'd also be paying for healthcare for my family which adds up as well.

Re: Laws barring noncompete clauses spreading

#178

Post by rnk »

lotsofpulp wrote: post #134
vkou wrote: post #82

Earlier quoted context omitted.

> Every such scheme has generally failed because they refused to emulate the one key piece of California law that is necessary for a startup ecosystem to exist – banning noncompetes. As I look out the window of my Seattle apartment, observing a literal forest of new construction, sky-rocketing rents and costs of living, I must interpret the tech boom here as 'the next Silicon Valley failing', because Washington state…

> Or, maybe I can choose to believe my eyes, and note that the the presence or absence of non-competes isn't a very important factor for driving a tech boom. [1] Or that other factors of working in WA somewhat mitigate downsides of non competes. Sad that WA lawmakers accepted the bribes from large businesses and capped non compete bans at $100k per year payrates. Could have leveled the playing field with CA a bit mor…

Seattle succeeds because it's the same time zone and Cali, Microsoft pulled tens of thousands of programmers here, then Amazon, now we have critical mass. What we don't have is nearly as many companies starting up here. I think noncompetes do actually reduce the number of new companies started in Seattle, and also reduce people switching jobs.

Re: Laws barring noncompete clauses spreading

#179

Post by kelnos »

bdw5204 wrote: post #127
paxys wrote: post #40

Over the years so many different jurisdictions around the US and the world have stated their desire to be the "next Silicon Valley" and have poured an immense amount of money and effort to make it so, whether in the form of incentives for businesses, tax breaks, education, job training, or even just straight paying smart people to move there. Every such scheme has generally failed because they refused to emulate the…

I'm fine with allowing non-competes as long as the company pays the ex-employee their full salary for the length of the non-compete and can't rescind the non-compete without mutual consent. For example, an 18 month non-compete would mean 18 months of paid vacation after you leave a job. I imagine this would be functionally equivalent to a ban on non-competes because it seems like it'd be an insane waste of money but…

I think that's fine for the employee (great, really: long-term paid vacation!), but if the goal is to create the "next Silicon Valley" or whatever, then allowing paid non-competes is going to work against that goal. You want an employee to get excited about striking out on their own and starting a company, immediately after quitting their old job (or, hell, before quitting their old job, as some SV founders do). Allowing their previous employer to delay that by 6, 12, 18 months (or whatever) isn't great for the entrepreneurial spirit.

Re: Laws barring noncompete clauses spreading

#180

Post by kelnos »

shagie wrote: post #162
Cupertino95014 wrote: post #119

Earlier quoted context omitted.

I've never heard of a court case involving a noncompete. Have you? (of course, I live in California.) It's maybe a little different if you're a chef and you've spent a lifetime mastering a particular recipe which is very hard to get right. You teach it to someone, and he goes out and opens his own restaurant selling that same dish. You can see the intuitive appeal of a noncompete, even if it's usually ineffective, an…

Blue Mountain Enterprises, LLC v. Owen https://law.justia.com/cases/california/court-of-appeal/2022... https://www.jdsupra.com/legalnews/california-court-of-appeal... > Despite California’s general hostility towards post-termination restrictive covenants, the California Court of Appeal, in a recently published opinion, Blue Mountain Enters., LLC v. Owen, 74 Cal.App.5th 537 (1st Dist. Jan. 10, 2022), affirmed that a p…

That's a "post-termination customer non-solicitation agreement", as you quoted, not a non-compete. CA may generally prohibit those as well, but we can't tell from this if a hypothetical non-compete would have been enforced in the same situation.
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