Sorry if this is a stupid question, how does a noncompete gets enforced anyway? Unless you’re a person legally required to make public your job, I don’t see how any private entities can trace your work history.
New York may ban noncompete employment agreements and Wall Street is not happy
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Re: New York may ban noncompete employment agreements and Wall Street is not happy
#52Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities. Actual code + NDAs banning literal reimplementations of stuff aren't that valuable, the knowledge and ideas will stay in the head of the employees. The tw…
> Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities. So the solution is that employees should only be able to work for one employer in their career? I wouldn't disagree with this argument if the noncompete…
It’s reasonably normal to be more like garden-leave where the employee is paid some high percentage of their base salary for some amount of time when they may not compete. This can still be very expensive for employees who will often have bonuses that are a large multiple of their base and so going down to base for the duration of the garden-leave.
Some places won’t compensate for the noncompete at all, others won’t compensate if the person works at a non-competitor. Some have a mix, eg up to a year of (paid) garden leave followed by up to a year of (unpaid) noncompete. If someone does leave one firm for another, there is often some negotiation, eg maybe the hiring firm agrees not to have the person work on certain things for some amount of time (potentially longer than the noncompete) and in return they can get them sooner.
So one solution is to allow noncompetes so long as employees are fairly compensated. It seems hard to discuss improving the rules around fairness there if you’re a politician because quant firm employees are not very sympathetic – it looks bad to say they are mistreated when they make many times more than lots of other professionals, even though by allowing that mistreatment you’re effectively giving the money to their even-better-off bosses instead.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#53Sorry if this is a stupid question, how does a noncompete gets enforced anyway? Unless you’re a person legally required to make public your job, I don’t see how any private entities can trace your work history.
Business owners and managers talk. I've heard of unofficial (and very illegal) blacklisting being a thing in NYC in the past, for multiple industries.
Collusion between employers to ensure that non-competes are enforced sounds very plausible, given that it is legal.
I think that the existence of a non-compete may also be a liability for the new employer, and it's not solely a practice meant to remind labor of what their place is.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#54Non-compete contracts should be banned unless the employee is compensated for the non-compete period. Period.
The employee should be over-compensated. If you were making $200k pre-tax at the job, the non-compete agreement should at a minimum require you to be paid $200k post-tax.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#55i'll post one of my favorite related facts about noncompetes. Famously, California bans them, but this was not an intentional policy choice for the sake of entrepreneurship. It was done in the 19th century and almost by accident.
David Dudley Field II was a jurist who drafted a code of laws which was adopted by New York state. After this, motivated by his study of English common law, he made an updated code of laws which included a provision banning noncompete agreements.
This model code was not accepted by New York, and just floated around for a while, until it happened to be on hand when California was becoming a state, with nobody thinking much about noncompete agreements.
North Dakota also adopted the Field Code and also bans noncompetes.
https://www.restrictivecovenantreport.com/2013/01/north-dako...
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#56Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities. Actual code + NDAs banning literal reimplementations of stuff aren't that valuable, the knowledge and ideas will stay in the head of the employees. The tw…
What kind of sensitive IP do quants have? How is it different than the tech industry?
General strategies of trading on financial markets. Entirely different than working at Google.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#57Earlier quoted context omitted.
Non-solicits also include not soliciting customers. Which is particularly relevant at consultancies where the product is a service. If you join a consultancy group, and 2 months later quit with the client roster... is it really OK to poach all their clients to start your own consultancy? All of these contracts are time limited, FWIW. E.g. non-solicitation doesn't mean you can never work your your colleagues again. It…
> If you join a consultancy group, and 2 months later quit with the client roster... is it really OK to poach all their clients to start your own consultancy? Yes. It's called free market competition and it's great for the society and economy. NYC bankers should be first in line to understand that.
What you’re advocating for is normalizing the stealing of company IP.
The way you solicit clients from a prior company is downloading the client list, exporting to a personal drive, quitting, then using the list to poach.
I’m fine if that’s your intention, but let your employer know upfront that you won’t protect confidential company data.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#58God bless Lina Khan our based monopoly busting, employee supporting FTC queen.
The FTC isn't the org with much power over employee rights. That's the DoL.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#59Earlier quoted context omitted.
I hear what you’re saying, but it’s hyperbole. I think there’s zero percent of you starving over your unwillingness to sign a non-compete. Pretending like the situation is that extreme isn’t helping anyone.
Why should I believe you? You don't offer an argument. It is entirely plausible that one could be faced with a situation of losing one's home, health insurance, ability to exist in modern life, and, oh, one's actual life due to unemployment. I know this because it happens. Non-competes, by definition, make this problem worse by reducing the number of jobs available to a person. What's your justification?
I’m not going to debate or justify non-competes. I’m also not advocating for them.
All I’m doing is calling you out that when you join a company, you’re voluntarily signing all of the contracts. It’s not some kind of involuntary act of slavery. A responsible adult is presented a contract and chooses to sign it. That’s the opposite of involuntary.
Your argument is it’s involuntary.
That’s what we were debating. I wasn’t debating the contents of the contract. I personally don’t see a major need for non-competes and is overkill in almost all cases.
I’m simply tired of the “I’m a victim!” mindset of blaming others for their own actions. It’s your fault if you signed a shitty employment contract. Next time read the fine print, or don’t sign it.
Re: New York may ban noncompete employment agreements and Wall Street is not happy
#60Non-compete contracts should be banned unless the employee is compensated for the non-compete period. Period.
The employee should be over-compensated. If you were making $200k pre-tax at the job, the non-compete agreement should at a minimum require you to be paid $200k post-tax.
Yup. Put your money where your mouth is
If that person was so valuable, had so much knowledge, had so many contacts etc…prove it in the only way business owners really understand