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Tell HN: Beware confidentiality agreements that act as lifetime non competes

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Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#131

Post by cam_l »

timoth3y wrote: post #71

Non-competes (including stealth non-competes like the OP mentioned) are being abused by US employers seeking leverage over their employees. In fact, 12% of hourly workers earning $20 or less had to sign non-competes. These workers do not have access to corporate secrets. It simply reduces their power to negotiate with their employer. https://www.minneapolisfed.org/article/2021/non-compete-cont...

Australia is straight up banning non competes for anyone earning under $175k, for this reason.

They are also tightening up the contract law around non competes to reduce the impact of the scare tactics employers have been using to bind low level employees with unenforceable, but still litigable, contract terms.

And scare tactics are really all they are (in this country), because even before they do this the courts have a track record in this country of looking very dimly on overly broad or restrictive non compete 'agreements'.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#132

Post by airocker »

airocker wrote: post #128

So if you are against this, you are okay with Coca Cola’s secret to be divulged by any employee to any competitor? If you cannot let companies maintain trade secrets, you may as well close them down.

There is a difference between trade secrets and non compete. If you can compete with the company without using trade secrets, like make a drink that people like without using Coca Cola secret, it is fine.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#133

Post by airocker »

93po wrote: post #130
airocker wrote: post #128

So if you are against this, you are okay with Coca Cola’s secret to be divulged by any employee to any competitor? If you cannot let companies maintain trade secrets, you may as well close them down.

as far as i can tell there are a million sodas that are extremely close to coca cola and coca cola is still doing just fine

That’s my whole point. They are not using Coke’s formula

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#134

Post by Sharlin »

schmichael wrote: post #112
tianqi wrote: post #45

I think the Chinese law is effective in this regard: in order to maintain any non-competition agreement, the company must continue to pay you a monthly compensation amount equal to 30% of your total monthly income when you were at the company. Whenever the payment stops, the non-competition agreement is automatically void.

Oregon at least makes it 50% IIRC. Anything less than 100% seems useless though. Usually when taking a new job in the same industry you expect a pay bump, so even a 100% rate is likely leaving money on the table.

Well, yes, but you don't have to work.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#135

Post by helpfulclippy »

jjallen wrote: post #125
tianqi wrote: post #45

I think the Chinese law is effective in this regard: in order to maintain any non-competition agreement, the company must continue to pay you a monthly compensation amount equal to 30% of your total monthly income when you were at the company. Whenever the payment stops, the non-competition agreement is automatically void.

Then the employee is only making 30% and presumably not working elsewhere or that would defeat the purpose. So how is this a good approach? I would get 80% or more but don’t see how this is effective.

This is the first I’ve heard of this so I’m just rolling it around… but I suppose this would make it cost-prohibitive for companies to insist on non-competes unnecessarily.

As the employee, it’s still clearly a bad position for me unless I can find a non-competing job that pays me at least 70% plus whatever pay bump I’d expect for career advancement.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#136

Post by sircastor »

airocker wrote: post #128

So if you are against this, you are okay with Coca Cola’s secret to be divulged by any employee to any competitor? If you cannot let companies maintain trade secrets, you may as well close them down.

This implies that any employee at Coca Cola knows and has access to the secret formula, which is of course, not true. And even if it were true, there's a substantial difference between a specific, limited piece of information (such as the recipe for Coca Cola) and broad concepts about operating in an industry.

I work in the Robotics industry. While the algorithm for our path planning would be a trade secret, how path planning is pursued is not. It's a fundamental concept in robotics. To extend the metaphor, it would be as if my company thought that any robotics work that involved path planning would violate their IP, because I did path planning work with them. It's nuanced to be sure, but some companies are very aggressive as to prevent you from having mobility in your career. Sometimes in a genuine effort to protect their IP, but also sometimes to reduce your negotiating power or punish you.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#137

Post by sircastor »

93po wrote: post #130
airocker wrote: post #128

So if you are against this, you are okay with Coca Cola’s secret to be divulged by any employee to any competitor? If you cannot let companies maintain trade secrets, you may as well close them down.

as far as i can tell there are a million sodas that are extremely close to coca cola and coca cola is still doing just fine

Getting off topic, there's an interesting This American Life story about the Coca Cola formula, and why there are many extremely close formulas, but no exact replicas.

[1] https://www.thisamericanlife.org/427/original-recipe

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#138

Post by scarby2 »

helpfulclippy wrote: post #135
jjallen wrote: post #125

Earlier quoted context omitted.

Then the employee is only making 30% and presumably not working elsewhere or that would defeat the purpose. So how is this a good approach? I would get 80% or more but don’t see how this is effective.

This is the first I’ve heard of this so I’m just rolling it around… but I suppose this would make it cost-prohibitive for companies to insist on non-competes unnecessarily. As the employee, it’s still clearly a bad position for me unless I can find a non-competing job that pays me at least 70% plus whatever pay bump I’d expect for career advancement.

> unless I can find a non-competing job that pays me at least 70% plus whatever pay bump I’d expect for career advancement.

This clearly depends on your role and industry. I can write code in a bunch of industries I've actually never had 2 jobs in the same industry. If I were an oil pipeline engineer it would be different.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#139

Post by airocker »

sircastor wrote: post #137
93po wrote: post #130

Earlier quoted context omitted.

as far as i can tell there are a million sodas that are extremely close to coca cola and coca cola is still doing just fine

Getting off topic, there's an interesting This American Life story about the Coca Cola formula, and why there are many extremely close formulas, but no exact replicas. [1] https://www.thisamericanlife.org/427/original-recipe

I think if the extremely close replicas ever threatened Coke's existence, they would sue. Especially if a former employee started it. I think trade secret protection is the only thing that enables a company to operate. Especially small companies, otherwise only large companies can operate. Any employee with a rich uncle can finish the small company off without this protection.

Re: Tell HN: Beware confidentiality agreements that act as lifetime non competes

#140

Post by sircastor »

kelnos wrote: post #129

So tired of this garbage. I think non-competes (and the legal concept of inevitable disclosure) should just be banned completely. Sure, some things (like taking customer lists when you leave a company) are messed up and should be barred, but companies should just be required to accept the fact that their employees will take some "proprietary" knowledge/information with them to their next job. I don't even think that…

> Sure, some things (like taking customer lists when you leave a company) are messed up and should be barred

Is it messed up? If you're a salesperson, and you've built the relationships with these customers is their loyalty to you, or to the company that you worked for? I had a personal trainer for a little while and he took all his clients to a new gym when he decided to contract with a different gym.

I don't know the answer to this. But it doesn't seem as clear cut to me.

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