Massachusetts Bill to Ban Non-Competes backed by Spark Capital • Hacker News Board

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#21

Post by tptacek » Fri, Apr 10, 2009, 6:41 PM UTC

biohacker42 wrote: post #19

tptacek wrote: post #15

Earlier quoted context omitted.

This move doesn't do anything to reduce the "market manipulation" you allege. If employers are negotiating from a position of strength, they'll get all manner of other concessions, starting with wages and benefits --- which is all most people care about. I don't see the principle that you're arguing from here. Your comparisons are a little silly, too. There are good reasons (right of way, regulation) and bad (monopol…

Noncompetes are a trade. Companies provide employees with access to resources, client lists, and trade secrets. They want to ensure that rolodexes aren't shopped and product plans aren't bootlegged. Isn't that an NDA? I see non-competes as nothing but attempts to reduce competition. Except that is exactly how markets are NOT supposed to work. You're supposed to out-compete , not simply reduce competition.

No. A sales account manager at AcmeTron can dump the entire CRM database, walk it over to WidgetCorp, and run all those same accounts for them without ever once violating an NDA.

Frankly, and I hope respectfully, if you can't see the distinctions here, I'm not sure why you'd expect anyone to take your opinions about noncompetes seriously. You might also consider wording your ideas better: "noncompetes are nothing but attempts to reduce competition", for instance, might not be your best rhetorical play.

I'm pretty ambivalent about noncompetes. They've hurt me more than they've helped me, both as employee and (in concert with) employers. But I don't like shoddy arguments.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#22

Post by tptacek » Fri, Apr 10, 2009, 6:42 PM UTC

mellis wrote: post #20

tjic wrote: post #5

I dislike the government asserting that I am not a fully competent adult, capable of making my own decisions about what agreements I enter into and which I do not. If I'm not competent to read a non-compete and agree, or not agree, to it, then why do they think that I'm competent to drive a car, or vote, or sign a lease?

Non-competes could be seen (from a company's point of view) as a form of the prisoner's dilemma: everyone is better off if no one requires non-competes, but if everyone else requires them than I need to. Therefore, a law of this sort could potentially improve conditions for all companies in a way that individual companies could not accomplish themselves. That is, the government is not trying to tell you what to do, i…

Really? Finish your thought. Why is everyone better off if nobody requires noncompetes?

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#23

Post by jhancock » Fri, Apr 10, 2009, 6:42 PM UTC

I've had lawyers in Georgia tell me a non-compete has no teeth under GA law. You still might get sued, but apparently, the law leans heavily towards the employee.

Intellectual property and trade secrets are however well protected for the employer.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#24

Post by tptacek » Fri, Apr 10, 2009, 6:44 PM UTC

sscheper wrote: post #12

Excellent movement on Spark's part. I've personally been handed a non-compete by a venture capital fund that would make a producer blush. It's preposterous what some firms try to con entrepreneurs into.

I'm really not sure why I'm expected to muster sympathy for entrepreneurs facing noncompetes from VC's. Isn't this an eminently reasonable use for noncompetes? You're epsilon from corporate-to-corporate contracts in this scenario.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#25

Post by tptacek » Fri, Apr 10, 2009, 6:45 PM UTC

jhancock wrote: post #23

I've had lawyers in Georgia tell me a non-compete has no teeth under GA law. You still might get sued, but apparently, the law leans heavily towards the employee. Intellectual property and trade secrets are however well protected for the employer.

That's the case in most jurisdictions; judges will tend not to interpret contracts in ways that preclude individuals from earning a living. In a lot of states, judges also have the authority to modify noncompetes on the fly, so that they aren't confronted with the choice of screwing a former employee and throwing out an entire contract term wholesale.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#26

Post by redrobot5050 » Fri, Apr 10, 2009, 6:47 PM UTC

tptacek wrote: post #14

toby wrote: post #11

Earlier quoted context omitted.

There are already plenty of things that can't be enforced by contract. You can't sell yourself into slavery, for instance, because the state isn't allowed to make sure you submit to your agreement. As another commenter said, sign whatever you like. Some companies make you sign non-competes in California, we just all know they don't mean anything.

Is slavery the only comparison you've got? Because slavery isn't remotely like a noncompete, which makes your argument sound weak.

Um, slavery is one of those things that've been outlawed -- meaning the courts will not recognize it as an institution. It makes his argument look strong. Outside of the state of nevada, he could've also said prostitution.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#27

Post by bdr » Fri, Apr 10, 2009, 6:55 PM UTC

I'd guess that people often agree to non-competes because they don't know how bad a deal they are. This could be solved if (1) people checked their contracts with lawyers more often, or (2) contract terms were standardized in such a rigid way that people could quickly learn about all the potential clauses.

Why don't people check their contracts with lawyers? If it's because of a high estimated cost, is that estimation right?

Part of the problem (and therefore part of the solution) is that the choosing of contract terms asymmetrically benefits the employer, since they only have to do the lawyer work once.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#28

Post by tptacek » Fri, Apr 10, 2009, 7:01 PM UTC

redrobot5050 wrote: post #26

tptacek wrote: post #14

Earlier quoted context omitted.

Is slavery the only comparison you've got? Because slavery isn't remotely like a noncompete, which makes your argument sound weak.

Um, slavery is one of those things that've been outlawed -- meaning the courts will not recognize it as an institution. It makes his argument look strong. Outside of the state of nevada, he could've also said prostitution.

Slavery wasn't a matter of contract law.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#29

Post by frig » Fri, Apr 10, 2009, 7:12 PM UTC

tptacek wrote: post #13

frig wrote: post #8

Earlier quoted context omitted.

It has nothing to do with your imputed (in)competence. All a decision like this would mean is: the state of MA has decided it's not in the interests of the state of MA to enforce noncompete clauses, so from here on out it will not enforce them. You can still sign whatever you want.

What does it matter what you can sign, if the contract doesn't have the support of courts to make it binding?

I know what you're getting at.

I was commenting specifically because I hate sloppy language and sloppy thought: there's just no meaningful sense in which "a particular kind of contract becoming non-enforceable" simplifies into "not being able to sign a particular kind of contract"; the latter implies some kind of intrusive intervention -- a noncompete gestapo slapping pen-from-hand should you try to sign such a contract -- which clearly wouldn't be the case under the proposal.

Re: Massachusetts Bill to Ban Non-Competes backed by Spark Capital

#30

Post by josefresco » Fri, Apr 10, 2009, 7:14 PM UTC

dmillar wrote: post #10

I agree. If you feel your employee is a value to you and potentially a competitor, you ought to compensate them accordingly. Personally, I would never sign a non-compete unless there were not only adequate considerations for compensation, but also equity.

Exactly. If you want your employees to be loyal to your 'cause', give them equity. Don't expect them to be a team player without some sort of reward beyond simply keeping their job.

As an employee I 'clock out' when my day is over and are free to pursue whatever I want in my own time. As an owner, I do everything I can to make sure my company survives and thrives around the clock both at work and at home. There's a definite line there that shouldn't be crossed (or you'll get burned)