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Massachusetts Governor Announces Plan to Abolish Noncompetes

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Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#21

Post by ghaff »

iamthepieman wrote: post #11

Just because they are non-enforceable doesn't mean they have no effect. The COO of one of past employers was offered a job at a competitor shortly after he was fired. When the new company heard of his non-compete clause and the intent of the old company to enforce it, they withdrew their offer.

When I worked for a small research firm, we basically wouldn't have employment discussions with anyone who had a non-compete even if it seemed unlikely their current employer would go to the mat over it. Just the existence of a non-compete would have meant getting lawyers involved and it was just too much hassle and risk.

(It's also the case that one of our large competitor firms, at least at the time, put non-competes in place that effectively wouldn't let anyone who left work for any competitor. i.e. they couldn't do the same job at any other firm. And, apparently, they enforced these agreements rather vigorously.)

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#22

Post by blaze33 »

In France I regularly had non-compete clauses in my employment contracts except here, it has to be specific, limited in time (1 to 2 years max) and you have to be compensated for it (usually 30% of your salary) otherwise it's legally void. The employer has the choice to enforce the clause (and to pay you) at the end of the contract and must notify you within 15 days.

You're usually notified that the clause is dismissed and that's it. I was told that it could be useful in some edge cases like if you know an employee will start a competing business with your current clients but I've never heard of such cases. Also I think the former employee could already be breaking confidentiality agreements, nda, etc. doing so.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#23

Post by JS1984 »

qwerta wrote: post #15
dsr_ wrote: post #2

I've been asked to sign a post-employment non-compete agreement several times. I never have, because I ask for a simple stipulation: for the length of time you don't want me to work in this field, you need to pay me the same salary. Everyone agrees that this is fair, and then never mentions the non-compete agreement again.

Czech republic and some other EU country actually have this in law. If employee with non-compete clause loses his job, employer has to pay his salary in full for duration of non compete. There are some exceptions such gross misconduct, voluntary redundancy etc..

Does the employer have an option to cancel the non-compete and not to pay the full salary?

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#24

Post by qwerta »

JS1984 wrote: post #23
qwerta wrote: post #15

Earlier quoted context omitted.

Czech republic and some other EU country actually have this in law. If employee with non-compete clause loses his job, employer has to pay his salary in full for duration of non compete. There are some exceptions such gross misconduct, voluntary redundancy etc..

Does the employer have an option to cancel the non-compete and not to pay the full salary?

I am not sure. If it is part of contract, it may require signing new contract by employee.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#25

Post by smackfu »

gtaylor wrote: post #10
dsr_ wrote: post #2

I've been asked to sign a post-employment non-compete agreement several times. I never have, because I ask for a simple stipulation: for the length of time you don't want me to work in this field, you need to pay me the same salary. Everyone agrees that this is fair, and then never mentions the non-compete agreement again.

Some of the jobs I've had or looked at made employment contingent on a non-compete. In those cases, saying something like this would mean finding another job. Depending on your skills, your area of expertise, and your reputation, this may or may not be a big deal to you personally, but it's not an option for everyone. My last employer (when I was straight out of college) would have just shown me the door if I said so…

If wonder if companies with mandatory non-competes have lower salaries. They should.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#26

Post by geebee »

This is good news for and from Massachusetts.

I read a very interesting thing about how non-compete agreements signed in other states are treated in California...

http://lawzilla.com/content/noncompete.shtml

"Who wins often depends upon a race to the courthouse. For multi-state employers it is often a rush to the courthouse to determine if a non-compete agreement is valid. The employer's strategy is to get an order outside of California in their favor. The employee or California prospective employer's strategy is to get an order within California in their favor. In the face of dueling, and opposing orders, the first to the courthouse may win because states often must give effect to orders from other courts."

The whole thing is actually very interesting, worth a read.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#27

Post by smackfu »

iamthepieman wrote: post #11

Just because they are non-enforceable doesn't mean they have no effect. The COO of one of past employers was offered a job at a competitor shortly after he was fired. When the new company heard of his non-compete clause and the intent of the old company to enforce it, they withdrew their offer.

A non-compete when you are fired? That's odd. It seems very simple for companies to lock up tons of talent just by hiring and firing them.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#28

Post by rz2k »

GFK_of_xmaspast wrote: post #12
drawkbox wrote: post #3

Non-competes are anti-business, anti-innovation and feudal. I have never signed one. I can't tell you how many times I have been asked to sign one that locks up your skills, which you are bringing to the company that they might not have yet, solely for them for years even though the project might only be 3-6 months. I applaud this effort immensely in MA, there is no place for non-competes in the US. It is entirely an…

Non-competes are very much pro-business, in that they weaken the power of labor.

And, if understood in that way, it is an instance where the term "pro-business" is a political ideology rather than an economic perspective.

Historically the rationale for pro-business policies is that greater production creates more wealth for everyone in a society. As a result it could be argued that a labor union might hurt an economy if less output comes from the same input, while those labor unions' arguments would be that they disagree about how different working conditions maximize the society's actual utility.

A non-compete on the other hand is a contract to decrease worker productivity. It is the opposite of union agreements that forced companies to employ people whose work is no longer needed, it is an agreement not to work. Furthermore, it isn't even entirely about benefiting business owners over their employees, but about benefiting established companies for their past success rather than whether or not they can compete in the current business environment.

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#29

Post by iamthepieman »

smackfu wrote: post #27
iamthepieman wrote: post #11

Just because they are non-enforceable doesn't mean they have no effect. The COO of one of past employers was offered a job at a competitor shortly after he was fired. When the new company heard of his non-compete clause and the intent of the old company to enforce it, they withdrew their offer.

A non-compete when you are fired? That's odd. It seems very simple for companies to lock up tons of talent just by hiring and firing them.

In the U.S many states (at least on the books) enforce non-competes even if fired without cause.

http://www.lexology.com/library/detail.aspx?g=f1eab2d5-0fda-...

edit: added link

Re: Massachusetts Governor Announces Plan to Abolish Noncompetes

#30

Post by jaegerpicker »

gtaylor wrote: post #13
patrickmay wrote: post #5

Limited non-compete agreements have value to startups. It's not unreasonable to want to protect the company's intellectual property, business plans, product roadmap, marketing strategy, etc. from someone who comes in, works for six months, and leaves to start a competitor. Certainly large companies are abusing these agreements. However, so long as the non-compete is agreed at the time of hiring, is restricted to a ye…

> Limited non-compete agreements have value to startups. Perhaps, but I often get the impression that startups think that they've got some kind of valuable secret methodology that is leagues better than everyone else. I feel that this is a really silly notion. Your startup is not a special snowflake. In fact, it's very likely to end in failure. It's the game we all play as entrepreneurs. Success is largely determined…

I completely agree, I've worked at 4 different start-ups and the successful ones weren't about ideas, they were about hard work and talent.
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