Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

New York may ban noncompete employment agreements and Wall Street is not happy

fortune.com

Post reply on HN
Print view View original

301–310 of 407 posts

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#301

Post by ghaff »

vachina wrote: post #51

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.

At a senior enough level it's public knowledge.

A lot of sub-industries are also "where everyone knows your name" places. I used to be an IT industry analyst (a couple of the large firms in which were known--at least at the time--for being pretty hard-core on non-competes) and pretty much everyone knew what firms other people in their space worked for. You could never have gone to a different firm and had your prior employer not know.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#302

Post by ghaff »

ndriscoll wrote: post #297
ghaff wrote: post #241

Earlier quoted context omitted.

How many people do you think are in a position to comfortably, even happily, take a 70% pay cut?

In fields like software or quant finance, I imagine a lot? Investopedia says that 200 salary and 500+ total is "not uncommon" for a quant, and that even entry level is 120-150. At 120k, 1/3 pay puts you at the median personal income in the US, which I'd say is a pretty sweet deal. At 200, you're close to median household at 1/3. People in this thread are saying you "only" get your base. If they really do get full bas…

I don't really disagree in this specific case. Although there's also lifestyle creep--perhaps especially in the case of living in NYC.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#303

Post by smabie »

ewhanley wrote: post #282
tomp wrote: post #270

Earlier quoted context omitted.

Quant firms have already adapted years ago. Now they don't have 6-24m non-competes anymore, but 6-24m notice periods. You're paid full salary (incl bonus) but you don't work ("gardening leave") and obviously can't work for a competitor (because you can have a non-compete while you're employed).

This seems like the correct and fair implementation of non-competes broadly. If companies want leavers out of the market, they should be required to pay garden leave. People have to make a living, and it’s unreasonable to expect them to change geographies and/or professions to do so.

Firms have always payed garden leave tho

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#304

Post by bobthepanda »

tester756 wrote: post #264
bobthepanda wrote: post #260

Earlier quoted context omitted.

clearly there's value in the secret if you're making them sign a noncompete. The proposal is just to ask firms to put money where their mouths are.

He says that just because someone knows a secret, then it doesnt mean that he brings value/$$$ to the company They should pay him 500k just because he knows a secret? even if he's making just 50k to the company?

A noncompete has value. If its worth 50k then pay for a noncompete equivalent to 50k wages worth of hours. Simple as that.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#305

Post by CSMastermind »

ghaff wrote: post #253
SpaceNoodled wrote: post #213

Earlier quoted context omitted.

No, it's what everyone should do.

Yeah, I'd still argue that a MAD system where highly paid (and presumably skilled) people need to take a year or two off between jobs is pretty inefficient. But if everyone knows that's the way things work, no one can say they were unaware of the rules.

Well the reason that this system exists is that there is real valuable knowledge that gives these companies competitive advantages. The usefulness of that knowledge drops off precipitously over time.

So the starting point for the system is that we need a way for these highly paid and skilled people to take a year or two off between jobs.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#306

Post by akira2501 »

hamandcheese wrote: post #225
caskstrength wrote: post #201

Earlier quoted context omitted.

> 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. Cry me a river. If knowledge of some particular employees worth so much to the quant firms, then they should pay them not to leave accordingly.

Knowledge of a secret does not imply that you provide value.

Are you speaking towards the employee or towards the quant firm? If the employee has no standing to claim value, then why does the underlying business get to?

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#307

Post by dh2022 »

tomp wrote: post #270
vgatherps wrote: post #26

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. 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 have already adapted years ago. Now they don't have 6-24m non-competes anymore, but 6-24m notice periods. You're paid full salary (incl bonus) but you don't work ("gardening leave") and obviously can't work for a competitor (because you can have a non-compete while you're employed).

Gardening leave leaves (pun intended :)) the possibility for the employee to leave with highly valuable acquired knowledge (trading strategies, algorightms, etc...) for a much higher salary and bonus than the gardening leave provides. Or maybe I am mis-understanding how gardening leave works? Thanks!

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#308

Post by dh2022 »

YetAnotherNick wrote: post #284
mancerayder wrote: post #280

Earlier quoted context omitted.

Other than getting paid without working for 6-24 months? Did I misread?

I think the GP meant why should you work when you can get paid without working.

You could work for a much higher bonus and salary. The way gardening leave has been described here is for people who are not looking to take their highly valuable knowledge somewhere else for higher bonus / salary.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#309

Post by F-W-M »

caskstrength wrote: post #198
arrrg wrote: post #50

Earlier quoted context omitted.

In Germany non-competes have a max duration of two years and compensation has to be at least 50%.

Living two years on half the salary sucks though.

It's a great start into freelancing though. They have to pay you 60% of your former salary upto 110% of it.

Re: New York may ban noncompete employment agreements and Wall Street is not happy

#310

Post by drhagen »

malux85 wrote: post #159
donatj wrote: post #155

Sometimes I feel like corporations do things just because their lawyers are cargo culting and adding clauses because everyone else does rather than some logical reason. My sister worked at Subway and had to sign a noncompete that she wouldn’t work at another sandwich shop for three years. Are they really afraid she’s going to steal their secrets of placing meat on bread? The more cynical will certainly assume malice,…

Is there a version of Hanlons Razor but instead of incompetence, it’s money? I’m a firm believer in that. The clause was probably put in there so the lawyers could bill more hours. I can easily imagine a legal firm noticing a drop in billable hours so they start reaching out to existing clients, throwing in a bit of fear, saying everyone is putting non-competes in their agreements you should too. Boom, all clients ge…

I always liked to phrase it as: "Never attribute to incompetence that which is adequately explained by incentives."

People like Hanlon's razor because it still lets them insult people they don't like. "incompetent" and "stupid" work about as well as "malicious" and "evil". I don't think anyone will ever give a name to a statement so...unsatisfying.

Post reply on HN