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Laws barring noncompete clauses spreading

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Re: Laws barring noncompete clauses spreading

#181

Post by [deleted] »

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…

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Re: Laws barring noncompete clauses spreading

#182

Post by Thorrez »

Cupertino95014 wrote: post #119
harry8 wrote: post #105

Earlier quoted context omitted.

Beyond banning them de-jure you've also got to ban them de-facto. "We all know non-competes are unenforceable and illegal." There are no consequences for forcing someone to have the stress, expense, time and to secure the financing so that if everything works as it should (which it often doesn't in all the various legal systems) you get only some of that back. If it doesn't work as it should you're toast. Not a nice…

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…

Here are 2 cases of Amazon suing former employees after they quit and got hired by Google:

https://news.bloomberglaw.com/daily-labor-report/amazon-uses...

https://www.geekwire.com/2019/amazon-sues-former-aws-exec-jo...

Disclosure: I work at Google.

Re: Laws barring noncompete clauses spreading

#183

Post by hn_zorba »

ska wrote: post #146
divbzero wrote: post #130

Earlier quoted context omitted.

Paying to delay competitors could be a good use of money for companies in many circumstances. That would work fine for an individual from a financial perspective, but keeping talent away from work is suboptimal for society as a whole.

> but keeping talent away from work is suboptimal for society I think this is basically a non-issue in practice. People with such iron-clad non-competes typically either a) take a non competing job, or b) work on something anyway. The latter effectively means the original company funds some research. If you do this with say, sales people, or traders, or whatever, it shuts down their work. If you do it with engineers…

I'm impressed by your faith in engineers, but it might be misplaced. I enjoyed a five months paid non compete when last moving between banks, and build nothing worthwhile during that time.

Re: Laws barring noncompete clauses spreading

#184

Post by origin_path »

ryandrake wrote: post #135
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…

> "But I'll spend money to train my employees and they'll just take those skills to go work for a competitor or start their own business!" Yes, that's a feature of the system, not a bug. This mentality has never made sense to me. Why would a business invest so much money into training someone, then fail to spend the money needed to retain the (more valuable) trained employee?? "They'll leave after we train them" is a…

The investment into training isn't merely money and can't usually be neatly calculated. It's usually paid in the form of time, motivation, distraction and lost opportunities by more senior staff. If you, personally, sink a year into training someone intensively, and then they leave, would you perceive it as merely lost opportunity costs? Probably not. Mentors and mentees are supposed to have a more than purely transactional relationship in most understandings.

As to why not just pay more, probably the reason you were trying to train someone to begin with is because you can't afford to pay the higher wages to just poach the most experienced people? Otherwise why not just pay the higher wages to start with and skip the risky and slow training? Also, the software world has the unique problem that everyone is competing against VC backed startups that are willing to spend more up front to minimize time to market, so these firms generally don't train but can afford to poach anyone who is trained at a perhaps unsustainably high salary.

Re: Laws barring noncompete clauses spreading

#185

Post by snovv_crash »

ryandrake wrote: post #135
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…

> "But I'll spend money to train my employees and they'll just take those skills to go work for a competitor or start their own business!" Yes, that's a feature of the system, not a bug. This mentality has never made sense to me. Why would a business invest so much money into training someone, then fail to spend the money needed to retain the (more valuable) trained employee?? "They'll leave after we train them" is a…

The issue is that a company that (all else equal) doesn't spend on training has more budget for salaries. Employees who already have skills generally value salary over additional training.

Re: Laws barring noncompete clauses spreading

#186

Post by squokko »

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 should be 125%. Make them really really want it.

Re: Laws barring noncompete clauses spreading

#187

Post by squokko »

shagie wrote: post #58
exabrial wrote: post #46

Earlier quoted context omitted.

1) That would be IP theft, and is already covered by other laws. 2) That is the problem I think this solves: retain your key employees. Maybe pay them a bit better than that 2% annual raise.

Starting up a consultancy to do installation of your former employer's software for clients isn't IP theft. If I worked for Atlassian and then created a company that did consulting for how to install Jira and and organize workflows - there's no IP theft involved there. Creating a new competitor isn't about retaining employees. Consider the situation of https://en.wikipedia.org/wiki/Rose_Blumkin > In 1989, six years a…

This is the system working as it should. Rose Blumkin's entrepreneurial talents were used to produce two successful businesses rather than one.

Re: Laws barring noncompete clauses spreading

#188

Post by squokko »

andirk wrote: post #36

Am I the only one who doesn't add any inventions and doesn't care about a non-compete clause because I will never honor it and come at me bro if you want to try to enforce it? I respect making sure the company doesn't steal someone's previous IP and I respect a company guarding their own IP. But I also respect that a person can work wherever the f they want without a previous company having any say.

Yes, if you produce no IP then nobody is really going to care what you do or don't do

Re: Laws barring noncompete clauses spreading

#189

Post by TeMPOraL »

hn_zorba wrote: post #183
ska wrote: post #146

Earlier quoted context omitted.

> but keeping talent away from work is suboptimal for society I think this is basically a non-issue in practice. People with such iron-clad non-competes typically either a) take a non competing job, or b) work on something anyway. The latter effectively means the original company funds some research. If you do this with say, sales people, or traders, or whatever, it shuts down their work. If you do it with engineers…

I'm impressed by your faith in engineers, but it might be misplaced. I enjoyed a five months paid non compete when last moving between banks, and build nothing worthwhile during that time.

> I enjoyed a five months paid non compete when last moving between banks, and build nothing worthwhile during that time.

Every now and then I see someone comment on HN about their experience with longer between-jobs periods, sabbatical, etc. The core theme I've noticed is that, apparently, it's common to "waste" some 3-6 months before one starts making good use of their time - apparently this is how much it takes to properly switch over to being fully self-directed.

If that hypothesis is accurate, then it's not surprising you've built "nothing worthwhile" during your five-month break - you've got yanked back into employment right as you were finally ready to make good use of your time!

Re: Laws barring noncompete clauses spreading

#190

Post by sokoloff »

nfriedly wrote: post #140
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…

I have a friend who got a new job, then gave it up because his previous employer "reminded" him that he had signed a non-compete. Now, we're both in Ohio, where it likely would have been enforceable, but the point I'm making is that a court case wasn't necessary - the mere threat was sufficient.

Had the same reminder when I changed jobs (in MA) ages ago. That reminder went to me and to the general counsel of my new employer.

Got hauled into a meeting with HR and general counsel where they both said basically “we got the same letter; we don’t think we compete nor would a court find we do; we’re sending them the following letter; don’t worry about it and get back to work.”

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