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Contracts you should never sign

vadimkravcenko.com

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Re: Contracts you should never sign

#151

Post by thwayunion »

claytonjy wrote: post #139
tallanvor wrote: post #100

Earlier quoted context omitted.

I agree. My contract says that my employer can choose to enforce a non-compete for 12 months after I leave, but if they do, they have to pay me during that time. It creates a strong incentive for them to not abuse the non-compete.

Are you in finance? That kind of compensated-non-compete seems common there, but rare elsewhere.

A garden leave clause is literally required for any noncompete contract to be enforceable in MA [1]. Hilariously, none of the FAANG companies include a garden leave clause for MA employees. NB: giving post facto garden leave isn't enough to enforce a non-compete; an actual clause needs to be in the signed noncompete contract in order for the contract to be enforceable.

My employment lawyer friend is fairly certain that if a FAANG tried to enforce a noncompete without a garden leave clause, they could be sued for triple damages, where the damages would certainly include the minimum required garden leave, and that if the enforcement attempt resulted in a job opportunity being aborted you could probably also include the full vesting schedule of your next employment contract in the damages (which, again, gets tripled).

[1] M.G.L Chapter 149 Section 24L:

(b) To be valid and enforceable, a noncompetition agreement must meet the minimum requirements of paragraphs (i) through (viii)...

(vii) The noncompetition agreement shall be supported by a garden leave clause or other mutually-agreed upon consideration between the employer and the employee, provided that such consideration is specified in the noncompetition agreement. To constitute a garden leave clause within the meaning of this section, the agreement must (i) provide for the payment, consistent with the requirements for the payment of wages under section 148 of chapter 149 of the general laws, on a pro-rata basis during the entirety of the restricted period, of at least 50 percent of the employee's highest annualized base salary paid by the employer within the 2 years preceding the employee's termination; and (ii) except in the event of a breach by the employee, not permit an employer to unilaterally discontinue or otherwise fail or refuse to make the payments; provided, however, if the restricted period has been increased beyond 12 months as a result of the employee's breach of a fiduciary duty to the employer or the employee has unlawfully taken, physically or electronically, property belonging to the employer, the employer shall not be required to provide payments to the employee during the extension of the restricted period.

Re: Contracts you should never sign

#152

Post by biztos »

claytonjy wrote: post #139
tallanvor wrote: post #100

Earlier quoted context omitted.

I agree. My contract says that my employer can choose to enforce a non-compete for 12 months after I leave, but if they do, they have to pay me during that time. It creates a strong incentive for them to not abuse the non-compete.

Are you in finance? That kind of compensated-non-compete seems common there, but rare elsewhere.

In Germany (and probably much of the EU) that incentive is built into the law, as it should be.

I think it’s boilerplate in big company contracts there, but extremely rarely enforced, because IIRC the amount you have to pay is the comp for the job you’re blocking.

When I had a contract like that, I occasionally fantasized about getting a FAANG job and being paid in full to not take it, but in reality that would never happen unless you got caught in a spat between rival executives.

Re: Contracts you should never sign

#153

Post by riskable »

moron4hire wrote: post #53
kibwen wrote: post #19

Earlier quoted context omitted.

> many-to-most of these clauses are in every boilerplate contract Contracts are entirely negotiable. If there's a job you want, but the contract contains an objectionable clause, tell them that you're willing to accept if they strike that clause. If you're at the point in the hiring process where they're showing you the contract, that means that they've sunk resources into you that they don't want to throw away. And…

In 20 years, I've never seen a company that was willing to negotiate over the employment contract of an employee . As a freelance consultant, I had free range to negotiate, but as an employee, the contract was always presented as "take it or leave."

That's probably because most people don't even think about it or bother trying. They may not even read the agreement!

I've successfully negotiated contracts several times in the past. Even once at a big company (that I knew was desperate :). As long as what you're asking for is reasonable they'll usually make the change unless it's a really big company. In that case they're not going to bother and just tell you to either sign it or go to work somewhere else. They know they have plenty of leverage and there's always someone else they can hire.

Re: Contracts you should never sign

#154

Post by somecompanyguy »

after a lifetime of web development [started in 1996], you should ask yourself "can i build a full product". if the answer is yes, don't sign contracts and start your product. employers don't pay what you're worth. you can save them 250k in a 2 week period and they won't know you did it and definitely won't pay you like you did. they might even toss you to the side thinking "oh my nephew makes websites". you might have just increased your client's conversion rates by 3% because of an issue on the checkout page and when you call to report on it they might say "oh wow that must be the advertisement i bought without telling you".

in most cases, its too technical for them to understand. i recommend avoiding employers if you're money motivated.

Re: Contracts you should never sign

#155

Post by grey-area »

nerdponx wrote: post #125
grey-area wrote: post #67

Earlier quoted context omitted.

They’ll tell you that this is unchangeable, it’s the default, etc the first few times, but if you persist, they’ll usually just strike out a clause like this if they actually want to come to an agreement. They may not even bother telling legal (depends on company size). Really it depends whether you’re negotiating from a position of strength and and can walk away, if you are changes like this become possible, if you…

I've never had any HR person give up even a comma in a contract like this, even after a full week of back-and-forth negotiating and trying to get them to strike out an individual sentence or change a word. Their attitude is that even if they lose their first choice hire over it, they always have a pipeline, and they'd rather adhere strictly to legal protocol and go with their second-choice hire.

Don't talk to HR, talk to the hiring manager.

Re: Contracts you should never sign

#156

Post by Delphiza »

OP refers to a post from Joel Spolsky, but there is a better one that he wrote that I'll include the text below.

It was one of those posts that stuck in my head because it makes sense. There may be an overriding reason why an employer is likely to tell you to take the contract as-is or walk, no matter how much they want you to join. You may think that you are super-valuable engineer, and maybe even the hiring manager, but not if your negotiation is likely to hold up the due diligence of the investors' exit.

https://www.joelonsoftware.com/2016/12/09/developers-side-pr...

Even if a company decided, “oh gosh, we don’t want to own the 5:00-9:00 inventions,” they would soon get into trouble. Why? Because they might try to take an investment, and the investor would say, “prove to me that you’re not going to get sued by some disgruntled ex-employee who claims to have invented the things that you’re selling.” The company wants to be able to pull out a list of all current and past employees, and show a contract from every single one of them assigning inventions to the company. This is expected as a part of due diligence in every single high tech financing, merger, and acquisition, so a software company that isn’t careful about getting these assignments is going to have trouble getting financed, or merging, or being acquired, and that ONE GUY from 1998 who didn’t sign the agreement is going to be a real jerk about signing it now, because he knows that he’s personally holding up a $350,000,000 acquisition and he can demand a lot of money to sign.

The above is an IP example, but non-competes may be the same (regardless of if they are enforceable). Q:"What is to stop everybody resigning after we announce the merger and working for the senior manager the next day?" A:"Every employee has signed one of > and most will be scared of the threatening lawyers letters that we send."

Re: Contracts you should never sign

#157

Post by riskable »

amelius wrote: post #75
7steps2much wrote: post #30

Earlier quoted context omitted.

If you make that pen available to me under these conditions? Sure. If you "just give" me something without any conditions then no, you could definitely not claim that story. But if you make that pen, your property, available to me explicitly only for work and nothing else? It's your property, not mine. I only have whatever rights you grant me to it.

Let's make this example a little more extreme to show how nonsensical a company claim is on stuff they did not create (or pay for). If I used the company computer to access a dating-website, then could the company claim ownership of my firstborn child, if that was in the contract?

> If I used the company computer to access a dating-website, then could the company claim ownership of my firstborn child

No, but first kiss is definitely on the table.

Re: Contracts you should never sign

#158

Post by thwayunion »

WalterBright wrote: post #138
thwayunion wrote: post #135

Earlier quoted context omitted.

It's even more dishonorable for a company with a legal team to offer up terms in a contract that are explicitly illegal, and then use those illegal terms to conduct unfair and deceptive business practices in the labor market. In fact, that scenario is so dishonorable that in some states you can ask the court for triple damages if the employer tries to enforce the noncompete

Your having honor is not conditional on others having honor.

There is no honor is dying on an ER stretcher.

For anyone in the US who needs regular healthcare beyond what's provided by Medicaid, the labor market is a war for (literal) survival. If the ownership class didn't want to return to an extremely adversarial relationship with labor, then they shouldn't have gutted the social safety net.

And no, I'm not going to show my hand in an imperfect information game... it would be stupid and dishonorable to my family to present with anything other than bourgeoisie professional-managerial class sensibilities.

Re: Contracts you should never sign

#159

Post by johndhi »

Eh. I'm a lawyer and don't agree with a ton here.

Work for hire of copyright and IP is standard. That's what it means to work for a company: you aren't working for yourself, you're working for them. You should look closely to make sure you can do a side hustle but other than that this is a little foolish.

I also disagree that contract negotiation means all that much. Certain lawyers are assholes but other people at their company might not be.

Re: Contracts you should never sign

#160

Post by kmoser »

riskable wrote: post #149
Aeolun wrote: post #52

Earlier quoted context omitted.

Nobody is going over a contract with legsl just because they removed the ‘we own everything you make’ clause. That’s an irrelevant part of the contract.

At big companies they will not change the contract for a single candidate. No way. Not unless it's a "big deal" sort of job where the executives are involved. They'll just tell you to go pound sand. The correct course of action is to cross out the clause, put your initials next to it, then sign the document. It is the responsibility of the company to have someone review contracts for such things but they never do; th…

This. You always have the power to change the proposed contract to suit your needs, and let them balk if they don't like it. This assumes it's a contract you can actually edit (whether on the computer or mark up with pen); for non-editable things (e.g. DocuSign contracts), I'm not sure what you'd do if you can't print it out pre-signing.
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