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FTC announces rule banning noncompetes

ftc.gov

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Re: FTC announces rule banning noncompetes

#161

Post by 0xbadcafebee »

bogwog wrote: post #120
lotsofpulp wrote: post #75

Earlier quoted context omitted.

I don’t get that appearance. Their website does not end in .gov and their about page does not indicate they are an official agency: https://www.uschamber.com/about

I have heard the name "US Chamber of Commerce" before, and as someone who isn't a politics/government nerd, I always assumed that was some kind of government organization responsible for something...commerce related. Clicking through to the website and seeing the kind of articles on there makes it pretty obvious that's not the case though, even ignoring the .com domain.

It's the largest lobbying group in the USA. It was created by Taft to fight organized labor. It's a core part of the Republican party, though it will diverge in the interests of capitalism. They denied climate change until 2019.

Re: FTC announces rule banning noncompetes

#162

Post by kiba »

crote wrote: post #131
akira2501 wrote: post #100

Earlier quoted context omitted.

> I've always thought of that as representing a stifling of innovation. The short lifetime of patents and the requirement that you publish detailed information about the invention significantly mitigates this. If they were measuring innovation by the number of copyrights filed, then I might agree with you.

In theory? Yes. In practice? No. For a lot of industries 20 years is an awfully long time to the point of complete irrelevance - and that "detailed information" is often vague enough to be unusable. Combine that with an overly-broad range of patent-able things and an overworked USPTO granting clearly invalid patents, and in practice (at least in the tech/software world) it's doing more harm than good. Patents are no…

Patents are no longer about protecting R&D investments.

Patents are always the tool of the moneyed and the lawyered, which is not the same thing as protecting R&D investment. There are exception, such as the guy who spent 12 years suing car companies over the windshield wiper, but that actually proves the rule because of time spent. It even apparently cause his marriage to break down. [1]

1. https://en.wikipedia.org/wiki/Robert_Kearns

Re: FTC announces rule banning noncompetes

#163

Post by [deleted] »

brigadier132 wrote: post #154
aidenn0 wrote: post #64

I am 100% for this, but it makes me sad that the legislative branch has nearly completely abandoned its duty to pass laws in favor of granting the executive branch the authority to regulate just about everything. This is a problem for two main reasons: 1. The executive branch can unilaterally revoke these regulations, making them more volatile. Maybe my non-compete is invalid today, but will it be in 4 years when I a…

> completely abandoned its duty to pass laws That's the duty of the legislature? To make more rules?

[deleted]

Re: FTC announces rule banning noncompetes

#164

Post by lokar »

lifeisstillgood wrote: post #158
lokar wrote: post #97

Earlier quoted context omitted.

They have other tricks. My comp was about 80% bonus, most of which went into deferred comp for a few years. If I was to go to a competitor without permission (independent of the non compete) I would forfeit the deferred comp.

But at a certain point that deferred comp is “enough” that if you just go to work each day and hide in the loos it’s worth waiting around and collecting the cash. And the company won’t benefit from a mostly checked out workforce

Worse. The next employer will just repay you. They all do this, so no one really gets and advantage, but they all pay.

Re: FTC announces rule banning noncompetes

#165

Post by bee_rider »

jbullock35 wrote: post #141
kevstev wrote: post #43

Earlier quoted context omitted.

I was subject to one as well, but it was just on my base, not total comp, which was not the majority of my compensation. And while my base was fine, it was more or less explicitly stated that this was meant to make it painful for employees to leave and had almost zero to do with any special information the employee had.

I'm not sure that I understand. What does it mean for a noncompete to apply only to base compensation? Is the idea that if you join a competing company within X months of leaving your old company, you need to repay your base salary to the old company?

I think they are saying that the compensation they their previous employer paid them to not work for the competition for a year was based on their salary, not their salary plus bonuses, so it was not as good a deal as it sounds.

Re: FTC announces rule banning noncompetes

#166

Post by timeflex »

JumpCrisscross wrote: post #34
bretthoerner wrote: post #11

My attorney friends tell me that the FTC doesn't really have the ability to do this, since contract law is part of state law. (My poor paraphrasing, not theirs.) I've been surprised I haven't seen this mentioned on social media or in the news. Are my friends wrong, or are people celebrating because this is just a step in the right direction even if it may not do anything yet?

> FTC doesn't really have the ability to do this, since contract law is part of state law The federal government can absolutely regulate both employment and contract law. (Merger agreements are contracts. The FTC was established to block bad mergers.) Whether the FTC can do this is untested. But that’s more a Chevron issue than a federal powers one.

Generally federal law will preempt state law. See the Court's decisions regarding California's attempt to ban arbitration agreements in employment contracts.

Now, that doesn't mean the Supreme Court won't come up with their own hot take, but at some point appeals and district courts are just going to say no when they send a case back.

What is the Supreme Court going to do? Federal judges can only be removed by impeachment of the House and conviction of the Senate. The Supreme Court has no power to enforce its decisions.

Re: FTC announces rule banning noncompetes

#167

Post by modeless »

Buttons840 wrote: post #127
bretthoerner wrote: post #11

My attorney friends tell me that the FTC doesn't really have the ability to do this, since contract law is part of state law. (My poor paraphrasing, not theirs.) I've been surprised I haven't seen this mentioned on social media or in the news. Are my friends wrong, or are people celebrating because this is just a step in the right direction even if it may not do anything yet?

Ask your attorney friends if a farmer growing food on their own land to feed to their own animals is "interstate commerce", and ask them to explain that to you. What I'm referring to here is Wickard v Filburn in which the Supreme Court ruled that a farmer growing food on his own land to feed to his own animals was participating in "interstate commerce" and could thus be regulated by the federal government. This is a…

The difference here is that Congress isn't banning noncompetes. The FTC is doing it. Different branch of government.

Re: FTC announces rule banning noncompetes

#168

Post by timeflex »

yieldcrv wrote: post #50
bretthoerner wrote: post #11

My attorney friends tell me that the FTC doesn't really have the ability to do this, since contract law is part of state law. (My poor paraphrasing, not theirs.) I've been surprised I haven't seen this mentioned on social media or in the news. Are my friends wrong, or are people celebrating because this is just a step in the right direction even if it may not do anything yet?

The federal government has the constitutional right to regulate interstate commerce, and 100 years ago it discovered that all commerce is now interstate commerce, followed by the supremacy clause which is selectively applied (ie. not for scheduled drugs, but for everything else) This Supreme Court could be friendly to invalidating that expansive interpretation though so, big mismatch from the executive branch / agenc…

The Supreme Court doesn't have any power to enforce its decisions. District and Appeals Courts could just say no to their decisions and there isn't much they can do.

Re: FTC announces rule banning noncompetes

#169

Post by 0xbadcafebee »

Shorel wrote: post #105

Can they also ban tipping culture?

Tipping culture stays because consumers don't want to pay what the product is worth. You reduce salaries and suddenly the food looks cheaper, and the "tip" is what they took out of the salaries. When restaurants end tipping, consumers revolt at the real prices.

Re: FTC announces rule banning noncompetes

#170

Post by cryptonector »

akira2501 wrote: post #100
LeifCarrotson wrote: post #59

Full text of the ruling here: https://www.ftc.gov/system/files/ftc_gov/pdf/noncompete-rule... It's not surprising after thinking about it for a minute, but it did startle me to read that the FTC measures innovation by the number of patents issued. > In addition, the final rule is expected to help drive innovation, leading to an estimated average increase of 17,000 to 29,000 more patents each year for the next 10 year…

> I've always thought of that as representing a stifling of innovation. The short lifetime of patents and the requirement that you publish detailed information about the invention significantly mitigates this. If they were measuring innovation by the number of copyrights filed, then I might agree with you.

> The short lifetime of patents

20 years is not short! 20 years might be appropriate for capital-intensive innovations (e.g., in pharma), but definitely not for industries where innovations are not typically capital-intensive. E.g., 20 years for cryptography and software patents is a disaster.

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