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U.S. moves to bar noncompete agreements in labor contracts

nytimes.com

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Re: U.S. moves to bar noncompete agreements in labor contracts

#181

Post by amanaplanacanal »

hannasanarion wrote: post #77
mschuster91 wrote: post #46

Earlier quoted context omitted.

The problem is, the courts may decide to kill it off before Congress gets out of its gridlock and approve or deny it, as many other regulations have been. Executive decrees or questionably legal actions of government agencies are fundamentally bad - but have become commonplace and a necessity of life since Congress is fundamentally broken. And at the core, the problem is that the US' political system unlike everyone…

Courts overturning regulations like that is exceedingly rare. The doctrine of chevron deference means that, in the absence of overwhelming evidence to the contrary, it is the prerogative of executive agencies to interpret their own mandate as they wish.

They have been using the major question doctrine to toss regulations lately though, which it appears to me they made up out of whole cloth.

Re: U.S. moves to bar noncompete agreements in labor contracts

#182

Post by falcor84 »

notch656c wrote: post #51
ecshafer wrote: post #21

Non-Competes being legal is only acceptable I think if the worker will continued being paid for the period of the non-compete. I can see reasons that non-competes exist, but those reasons don't really make sense in a world where patents and trademarks also exist. The fact that they are essentially illegal in California, and California's economy works shows that they are unnecessary and also don't hinder technological…

Should be reciprocal if it exists. I.e. if the employee leaves, the company would be barred from hiring anyone else for any remotely similar tasks. Make them taste their own medicine and decide if it's worth it.

I would love to take a short vacation to an alternate universe where all job descriptions say that applicants MUST NOT have any recent experience in the area of employment.

Re: U.S. moves to bar noncompete agreements in labor contracts

#183

Post by renewiltord »

thwayunion wrote: post #100
chaoz_ wrote: post #71

Would be interesting to see how contracts in HFT are going to change. From what I heard, when some specialists (e.g. hardware folks) are changing jobs, then the firm is likely to lose an "edge" as competitors will have access to similar technology/knowledge. Garden leave helps to mitigate this effect. If non-competes are banned, then TCs are (probably) going to rise even more.

> when some specialists (e.g. hardware folks) are changing jobs, then the firm is likely to lose an "edge" as competitors will have access to similar technology/knowledge. So without the employee the firm can't compete? If that's really true, then that employee should be able to extract as much blood as they want. They are literally the keystone of the business. The good news is that the FTC rule would allow the firm…

It's less that and more that once you see the inside here you can pass that on to the other place. Knowledge is everything. And it turns out you don't have to be the one to make something in order to memorize it.

Re: U.S. moves to bar noncompete agreements in labor contracts

#184

Post by dmlerner »

not_the_fda wrote: post #166
cbb330 wrote: post #125

Government intervention is heavy handed and will cause unintended side affects with 100% certainty. What should happen is for: 1) employees to choose to not join companies with contracts that they don't agree with 2) employers offer better incentive to not leave for roles at risk to poaching e.g. RSUs. A natural market response to bad company policy is always preferred to government mandates.

Often times you are not informed about non-compete until your first day of work unless you know to explicitly ask about it. They have you over the barrel at that point. I once took a job at a design service company. Asked about any non-competes and invention stuff. Said there wasn't any verbally. I get there and they have this draconian non-compete that you can't work for any other design services, start your own des…

How are you not informed in advance? Every job I've had, there's a contract I sign in advance with all terms, and no addendum on day one. I'd think you could refuse to sign an addendum, and even sue for promissory estoppel if they fire you for not signing.

Re: U.S. moves to bar noncompete agreements in labor contracts

#185

Post by ericmay »

bumby wrote: post #168
ericmay wrote: post #154

Earlier quoted context omitted.

I would agree that treating economic efficiency as an end to itself isn't ideal - that creates lots of obvious problems. It's probably super efficient to have child labor, for example. > I think part of me just laments the fact that previous generations took a much bigger risk to form unions and modern generations have largely let it fall to the wayside. I agree, and it's frustrating not just here but in the politica…

> suburbanization and social media This is interesting. Can you expand on the how you think this changed the overall sentiment of civic responsibility?

I’m being flippant and I can expand more, but I’d say it amounts to this:

I sure hope there is parking at the protest

Re: U.S. moves to bar noncompete agreements in labor contracts

#186

Post by ssharp »

brightball wrote: post #164
Ethan_Mick wrote: post #91

Good. I've seen over and over this harm friends in frustrating ways. Tech aside, non-competes in other industries are completely insane. My wife is an optometrist and all local shops have draconic noncompetes you are forced to sign. If you leave the shop you can't work within 30 miles (or more!) of that location. I've had friends move entire cities just so they can get out of a terrible work situation. Worse, I've ha…

IMO the primary concern at an office like that is having access to patient data and then enticing them to go elsewhere. If the person wants to go work elsewhere, totally fine. The concern is trying to take customers or other staff with them. I know somebody that happened to. Company opened a branch office and one of the senior staff rented an office around the corner, took half the staff and patients. Stuck them with…

There are usually non-solicitation clauses as well that prevent you from actively recruiting former co-workers and clients/customers. That's different than a non-compete.

Re: U.S. moves to bar noncompete agreements in labor contracts

#187

Post by hn_throwaway_99 »

LeonM wrote: post #150
ajsnigrutin wrote: post #19

I understand noncompetes in some fields... but this can be solved in other ways. In my country (slovenia), a noncopete is valid only if you're being financially compensated by some amount while the noncompete lasts. It's a bit complicated here, but ideally companies wanting noncompetes could be forced to pay the difference between what the worker would've earned if they stayed (+ some safety factor for a potential ra…

> a noncopete is valid only if you're being financially compensated by some amount while the noncompete lasts. And this is about the only way they hold up in court, otherwise the non-compete would be a one-sided contract. IANAL, but I was once sued by a former employer over a non-compete (an entry level IT job). The judge basically swept the floor with it. Also, it made me understand why severance packages exist, it…

> Now when you hear outrage over some bank exec getting a million dollar severance, know that this can be because of a non-compete.

But, as you pointed out with your story, much of the outrage is still directed at the rank hypocrisy that goes on - companies easily try to force noncompetes with little or no compensation to low level workers, but then automatically know they need to pay execs millions for the same privilege.

Re: U.S. moves to bar noncompete agreements in labor contracts

#188

Post by Eumenes »

gameman144 wrote: post #110
Eumenes wrote: post #76

Lol @ this being an FTC proposal. Whats next, OSHA limiting your speech at work?

What do you mean there? Maintaining competition in a labor market seems like it's absolutely within the scope of trade regulations.

Why are they suddenly making this decision in 2023? Seems like something congress should change.

Re: U.S. moves to bar noncompete agreements in labor contracts

#189

Post by 1vuio0pswjnm7 »

0xAFFFF wrote: post #137
eclipsetheworld wrote: post #27

In Germany we have non-competes, however, the employer has to continue paying the ex-employee (a part of) their salary for the non-compete to have any effect.

In France a non-compete clause must be attached to financial compensation or it is considered void.

Imagine that the employer does not have a non-compete in place with her current employees. In the US, she may offer a single, token amount in exchange for signing an agreement containing a non-compete clause. This could, for example, be described by the employer as a "bonus". It does not have to be reasonably-based on the amounts the employee might gain from working for a competitor. It could be much lower. The employer could make signing the agreement a prerequisite to continued employment. Arguably the purpose of such a "bonus" is primarily to protect the employer against challenges to the enforceability of the agreement, not as an incentive or reward to current employees.
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