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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

#411

Post by endisneigh »

foobiekr wrote: post #399
endisneigh wrote: post #95

I disagree with banning noncompetes. The issue IMO isn't noncompetes, it's the fact that an employer doesn't have to pay. The rule should be that they can make you not compete, but you must be compensated monthly at your salary level prior to departure. A non compete without having to pay is having your cake and eating it to so to speak.

Be careful what you wish for, there are significant non-salary benefits (stock ESPP and RSUs, healthcare subsidy, etc.) that matter a lot. These employers would just restructure compensation to effectively recreate low-cost non-competes.

Not a big deal, could just say income as reported on your W2, then.

Not to mention employers already enforce non competes and don’t pay anything.

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

#412

Post by Spivak »

MajimasEyepatch wrote: post #215
AdmiralAsshat wrote: post #8

Would prefer this came from Congress rather than the FTC, because I can see at least two different ways this could get sunk from the FTC: 1) The process gets stalled from rollout until 2024, at which point a Republican comes into power, appoints new FTC head, and they roll it back. 2) Companies sue, and SCOTUS rules that this exceeds FTC authority. But I'll freely concede that there is no way such a bill would ever m…

Such a bill could make it through a Democratic Congress with a large enough Senate majority. Unfortunately we don’t have that right now.

I have to believe that some, if not most, Republicans would go for a bill like this. A bill that's "freedom-from", costs nothing, is pro-worker while not being pro-labor, you get free talking points for "see you don't need unions."

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

#413

Post by humanistbot »

b112 wrote: post #407
humanistbot wrote: post #403

Earlier quoted context omitted.

The thing that makes me so angry is how lightly so many people treat these legally binding contracts. I showed up to a meetup at some tech company's offices. After putting in my name, I was shown a contract on a small tablet and was expected to click next and sign with my finger. I have normal vision and couldn't read it without putting it right in front of my eyeball. I don't sign anything without reading. I asked i…

Their response? "Oh, that's just all standard legal stuff, don't worry about it." I'm a Canuck, so centuries of legal, common law separation here... But if someone misrepresents what a contract is, and even more so applies pressure to sign, it's meaningless. My understanding is that this goes back to "make your mark" and lower levels of literacy, and in modern times, that legalese is gibberish to many, thus misrepres…

We do have what we call "fraudulent misrepresentation" in the US. It could give me grounds to seek damages or invalidation of certain misrepresented provisions, but doesn't automatically make the contract meaningless over here. The two problems are specificity and proof, both of which require more consent from the receptionist than they are probably willing to go along with.

It would be fraud to misrepresent a material fact at time of signing, such as the quality of goods or, say, if a loan officer says that interest is fixed-rate, when the contract says it is variable-rate. But for my case, what does "standard legal stuff" actually mean? I'd argue it is actually pretty standard for a Bay Area tech company. What does "don't worry about it" actually mean? If I asked the receptionist to explain more or "does this include a non-disparagement agreement?", I doubt they would have said anything.

For proof, I was in California, which is a two party consent jurisdiction for recording. So I could have pulled out my phone and said "I'd like your permission to record what you just told me about the contract. Can you please state your name, position at Company X, and what you just told me about it being all standard legal stuff?" If I was that receptionist, I'd probably call security.

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

#414

Post by drewda »

yardie wrote: post #212
drewda wrote: post #179

As the saying goes, California is the United States... just 30 years in the future. (Note that often this is a good pattern, but not always!)

If thats true the rest of the US is going to be on fire, have an abundance of homeless, and high speed rail still won't happen.

Perhaps.

But the relevant point here is that California has long had state law banning most forms of non-compete clauses in employment contracts. It's considered to be one of the strengths of Silicon Valley and other California industries -- talent can move from established company to established company, or established company to startup.

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

#416

Post by kevstev »

Sohcahtoa82 wrote: post #392
kevstev wrote: post #249

Earlier quoted context omitted.

The problem is that the threat of litigation is enough to make them essentially enforced. Sure you could go to a lawyer that says this isn't worth the paper its printed on, but either you, or maybe your employer, is now going to have to fight this out in court. This is not theoretical. A few years back, my wife, who is in ad sales, had very deep relationships with certain companies. These people had become her friend…

> A few years back [...] She took a job at AOL That's gotta be more than "a few years".

This was 2015ish? Right before they turned into Oath. AOL existed for a lot longer than anyone realized- and actually operated more like a hedge fund buying media properties with funds from people who were still subscribing to what was left of the online service. Millions of people, literally still paid the fee, many thinking it was the only way to keep their email address.

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

#417

Post by MiddleEndian »

sagarm wrote: post #382
MiddleEndian wrote: post #316

Earlier quoted context omitted.

Even that seems too much in favor of non-competes. Instead it should simply be treated like another job that I can quit at-will. If you don't want me to work for a competitor, pay me some amount of money we negotiate like a salary. It's up to you if you think it's worth enough to pay me not to work, and me to be paid enough not to advance my career how I choose during that time.

This seems equivalent to simply retaining the employee.

Yes, exactly. As it should be. If you don't want me to work elsewhere but also don't want me to work, that's on you to figure out. Compensate me adequately to do nothing or let me be. If companies are unwilling to do that, perhaps it's not a real concern.

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

#418

Post by dec0dedab0de »

Nomentatus wrote: post #280
subradios wrote: post #271

Earlier quoted context omitted.

The issue is that it's very difficult to tell trade secrets from expertise in certain fields. In a field that is sufficiently niche, like non flagship chip production - a lot of architectural ideas are well known across the industry are but the implementation details that enable them are trade secrets. You can't "un see" these details and IP law is loose enough that you could easily reimplement those features or prod…

IANAL but I had (kinda unconsciously) assumed that what can be protected by trade secrets was broader than what patents protect (patents merely implementations - which might be broad.) So I'd like to know more; though I wouldn't be shocked (now that I think about it) if you're quite right. In any case, even if the employee refuses to work on a given task, that's information. Having to say: "Yeah, I think you want som…

As far as I understand it, the only time trade secrets are protected is when they are forced to be revealed in court. If for example Zildjan cymbals is in a lawsuit, and discovery requires that they divulge their trade secret for making cymbals, then the court will issue an NDA for everyone that sees it, and seal the records. However, if a former Zildjan employee writes a book with the details, then there is no protection. Which is why they only limit the secret to family members. Fun fact, Sabian uses the same secret technique, because it is the same family.

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

#419

Post by xyzelement »

jeremydeanlakey wrote: post #209
xyzelement wrote: post #180

Non competes are often necessary in the most interesting jobs. A few years ago I took a job at a hedge fund with a 2 year noncompete. I took a calculated risk doing so. In the 2 years I worked in the fund, I learned a tremendous amount thanks to being exposed to the "secret sauce" which would have been really damaging for me to take to a competitor. After I left the fund, I took the 2 year non-compete (ie: don't work…

> The bottom line is, a non compete is not something that springs on you. It's pretty standard now for employers to spring on you a previously-unmentioned non-compete clause at the time that you're onboarding. I've learned to ask for it before accepting an offer but I don't think most employees know to do that. I'm a capitalist and I think non-competes have a very valid purpose in a limited set of circumstances. But…

I can get behind that. Non-competes between two consenting adults - great. If presentations are shady and opaque, that's a different story and a problem (and I would say that about any attribute of the employment contract that isn't easy to understand upfront)

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

#420

Post by monksy »

chadash wrote: post #275
monksy wrote: post #252

Earlier quoted context omitted.

Non-competes do not protect an organization against IP theft or trade sceret dismenination. Those are portected by NDAs, confidentiality agreements, copyrights, patents, etc. Non-competes limit where your staff can go to. Without proper compensation for the time period in which they apply for, they're a very one sided (and in some cases illegal [NCs are legal in IL unless they assert an economic hardship]) way to pre…

> Those are protected by NDAs, confidentiality agreements, copyrights, patents, etc. This gets thrown around HN a lot but I don't think it matches reality. Say I work in machine learning algorithms for show recommendations at Netflix. Amazon hires me to work on their machine learning algorithm recommender on Prime Video. Sure, I might have NDAs to protect what I learned at Netflix, but how does Netflix realistically…

Violations are determined via a legal complaint and review/investigation. Violations are not termined by company A hiring a person from company B.

Non-competes (non-paid out) only put time between companies (in some states it might be beyond the lifetime of the person under a NC). To put that, and not fully pay out at the current salary, puts a uneven pressure on the individual who was pressured into agreeing to it for (unguarenteed) employment.

Additionally, non-competes survive termination by the company.

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