U.S. moves to bar noncompete agreements in labor contracts • Hacker News Board

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

#461

Post by dhx » Fri, Jan 06, 2023, 2:14 AM UTC

mnehring wrote: post #290

gen220 wrote: post #253

I think we're all pretty familiar with the arguments against non-competes. Does anybody have a compelling argument for them, as practiced in 2023 in the US? While we're at it, does anybody have a compelling justification for allowing non-poach agreements, too? From my perspective, they both seem like a non-durable benefit to $current_employer at the expense of a compounding opportunity cost to the greater economy (in…

So, here are a couple of arguments for: 1. I have a relative who is an MD. He was recruited cross-country at great expense. (Average cost to recruit an MD can be about $250K). So, if his comp was $200K/year and it cost $250K to recruit, a neighboring practice could monitor for new incoming docs, and make an offer of $220K/year in salary to the newly hired doc. If that happened, it would be in the best interest of the…

1. There's two costs being confused here. The impact of a doctor burning out or otherwise retiring and no longer using their qualifications, requiring the training of a junior doctor with required specialisations at a potential cost of USD$250k-$1M[1] and many years of waiting. And the much less significant impact of a doctor using their qualifications to find an equivalent job with a different employer. In the later example, it's a fairly standard professional recruitment process and cost.

2. Stock options are a risky gamble for employees and employers alike. Neither party can rely upon stock options too heavily as a retention tool because no one knows what the stock options would be worth 3 years in the future. If it's really essential to keep employees on for numerous years then guaranteed salary increases would be a better way to ensure employees are adequately compensated for the detriment to their career of staying in the same organisation doing the same work for a long period of time. And of course, proactively ensuring employee salaries are _always_ in the top decile of industry/specialisation salaries is needed too because it is not uncommon for some labour rates to move +10% in a single month. Many employers with a high NIPE/PPE[2] could easily pay higher salaries if they desired to keep employees for longer periods of time.

3. Aren't patents are meant to protect such R&D investments? Employers benefit from hiring from each other creating a mixture of technical knowledge and culture that is gained from employees having worked in different roles and projects elsewhere. Thus I struggle to comprehend why employee movement would be viewed as a net negative overall that justifies non-compete agreements.

[1] https://www.ama-assn.org/practice-management/physician-healt...

[2] https://tipalti.com/profit-per-employee/

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

#462

Post by sbaiddn » Fri, Jan 06, 2023, 2:32 AM UTC

Im ok with noncompetes.

However, if my would be ex-employer wants to block me from joining a competitor then he has to pay me 150% of the salary that the competitor would have paid me for the duration of the non compete while I twiddle my thumbs.

Fair is fair

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

#463

Post by netheril96 » Fri, Jan 06, 2023, 2:33 AM UTC

r00fus wrote: post #221

netheril96 wrote: post #160

Earlier quoted context omitted.

I disagree. The law can only mandate salaries during noncompete periods. It cannot mandate bonuses or stock grants, both of which can be significant. And as an employee, I prefer that noncompete has no effect. Even if I were paid during noncompete period, I would be outcompeted by other people who are working rather than being idle. It would set my career back.

Would you be ok if it was total compensation (averaged over a reasonable period) and not salary?

Ny second paragraph talked about that. It would set my career back doing nothing.

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

#464

Post by heavyset_go » Fri, Jan 06, 2023, 2:37 AM UTC

humanistbot wrote: post #403

steelframe wrote: post #332

When I was interviewing last year, I cut off an interview loop with a company primarily because I don't reside in California and their NDA was, "Anything you say, anything we say, forever." Since I was also interviewing with one of their direct competitors that I really preferred, I didn't want to put myself anywhere near a legal situation where they might try to mess things up for my career. They freaked out when I…

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…

If you think that's bad, I've been to multiple medical practices where part of the "standard legal stuff" they want you to sign would have you give them the right to sell your private information and info about your visit to their partners for the purposes of advertising, etc.

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

#465

Post by pseudalopex » Fri, Jan 06, 2023, 2:47 AM UTC

jonny_eh wrote: post #428

steelframe wrote: post #332

When I was interviewing last year, I cut off an interview loop with a company primarily because I don't reside in California and their NDA was, "Anything you say, anything we say, forever." Since I was also interviewing with one of their direct competitors that I really preferred, I didn't want to put myself anywhere near a legal situation where they might try to mess things up for my career. They freaked out when I…

Good for you, but the article is about non-competes, not NDAs.

The comment was about NDAs used as non compete agreements.

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

#466

Post by vegetablepotpie » Fri, Jan 06, 2023, 2:52 AM UTC

humanistbot wrote: post #403

steelframe wrote: post #332

When I was interviewing last year, I cut off an interview loop with a company primarily because I don't reside in California and their NDA was, "Anything you say, anything we say, forever." Since I was also interviewing with one of their direct competitors that I really preferred, I didn't want to put myself anywhere near a legal situation where they might try to mess things up for my career. They freaked out when I…

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…

What makes me upset is when kiosks and websites ask you to agree to terms and conditions, and while you’re reading them, the interface times out.

There’s zero intent from operators to allow their users to understand what they’re agreeing to. It’s all legalese written for their convenience.

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

#467

Post by anon7725 » Fri, Jan 06, 2023, 3:00 AM UTC

steelframe wrote: post #434

bumby wrote: post #389

Earlier quoted context omitted.

> I personally know several people in my state who had their careers impacted due to threats from former employers over an NDA I'm curious, was there any actual legal action or was it just the threat? I'm not dismissing the fact that a threat can create enough risk to make someone change their behavior, but I've also heard these NDAs are tough to legally enforce. Of course, nobody wants to be the one calling their bl…

> I'm curious, was there any actual legal action or was it just the threat? One particular instance that stands out in my mind was for someone who I saw hired into the company for a specific role with a certain scope. The previous company's HR then sent a letter to the new company's HR telling them about the employee's obligations under the NDA. The new company's management decided the prospect of a legal issue was t…

That sounds like tortious interference to this layperson.

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

#468

Post by Falkon1313 » Fri, Jan 06, 2023, 3:08 AM UTC

csdreamer7 wrote: post #445

crazygringo wrote: post #191

Earlier quoted context omitted.

But even that has major drawbacks -- if you're not actually working, then you're not building your resume, you're not getting promotions, you're not advancing. And if you find your work meaningful and satisfying, that meaning and satisfaction is gone. Not to mention who determines how much "being paid" means, when compensation isn't just base salary but also variable things like company bonuses, individual performanc…

You are also not making a higher salary you would have made at the competitor depressing tax revenue and wages (especially until that minimum profits tax passed companies were paying 0% income taxes anyway). The trade secret argument the poster above you alluded to is very unlikely. Usually a competitor is hiring you because you are already somewhat trained and up to speed in their field... and perhaps the competitor…

>Noncompetes only for the company, not the worker

Now there's an idea - a fair noncompete. Employee can't use their knowledge/skills for 2 years after they leave, but also the company can't hire anyone with any industry knowledge or related skills for 2 years after they leave either. Wonder how many companies would like that idea?

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

#469

Post by trentnix » Fri, Jan 06, 2023, 3:18 AM UTC

humanistbot wrote: post #403

steelframe wrote: post #332

When I was interviewing last year, I cut off an interview loop with a company primarily because I don't reside in California and their NDA was, "Anything you say, anything we say, forever." Since I was also interviewing with one of their direct competitors that I really preferred, I didn't want to put myself anywhere near a legal situation where they might try to mess things up for my career. They freaked out when I…

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…

100%

It’s ridiculous how flippant and deceptive companies are about signing non-competes. Sometimes they neglect to mention it until you actually show up for work. So there you are, depending on this new job, standing in front of your new boss, compelled to create and maintain a positive relationship, presented with a legal contract that significantly damaged your leverage and alternate prospects.

That might even be criminal.

Often, I hear from some about how non-competes in some states are “non-enforceable”. But even when that’s true it doesn’t inoculate you from serious problems.

A friend signed a non-compete regarding professional services when he want to work (as an independent contractor, mind you) and was sued by the company after he left. He lawyered up and won, but the case took 18 months due to stalling and delays by the company. During that 18 months the judge had granted an injunction preventing him from providing similar services, leaving him effectively unemployed. It did great damage to his savings and the strength of his resume, which now had a significant gap.

As I said, he won! But he was awarded no damages, despite the victory. Seeing this play out convinced me that even you’re in the right, the process can be plenty of punishment on its own.

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

#470

Post by lmm » Fri, Jan 06, 2023, 3:34 AM UTC

humanistbot wrote: post #403

steelframe wrote: post #332

When I was interviewing last year, I cut off an interview loop with a company primarily because I don't reside in California and their NDA was, "Anything you say, anything we say, forever." Since I was also interviewing with one of their direct competitors that I really preferred, I didn't want to put myself anywhere near a legal situation where they might try to mess things up for my career. They freaked out when I…

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…

> The thing that makes me so angry is how lightly so many people treat these legally binding contracts.

But most of them aren't legally binding.

I've never understood why people care so much about these unenforceable non-competes. They want me to sign a contract that's inherently void? Sure, I'll do that all day (or if I'm feeling feisty I'll ask them for a small salary bump for the trouble - may as well take the free money right?). If they want me to witness them signing a deed to the Brooklyn Bridge I'll do that too.