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FTC cracks down on companies that impose harmful noncompete restrictions

ftc.gov

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Re: FTC cracks down on companies that impose harmful noncompete restrictions

#181

Post by MBCook »

shukantpal wrote: post #180
Conan_Kudo wrote: post #153

Earlier quoted context omitted.

> If you work as a chef at my Mexican restaurant, it seems fair to bar you from opening another Mexican restaurant within say 1 mile. For a year. I would argue that's not fair at all. Think about what you're saying: you're saying that your Mexican restaurant should effectively not have to worry about your competition providing a better job to your staff than what you offer. That changes the dynamic so that you don't…

You didn’t read the comment. It’s not about getting a job in a restaurant within 1 mile - but rather opening a restroom yourself in that radius.

Right. Your chef should be able to work anywhere that needs a chef.

I don’t think it’s fair if they leave you without a chef and open a new restaurant selling the same kind of cuisine down the bock tomorrow.

That seems more like a spite restaurant. And I’m ok with putting a simple time/distance limit on that. Next year? Nearby city? Different kind of food? Go for it tomorrow.

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#182

Post by kweingar »

MBCook wrote: post #181
shukantpal wrote: post #180

Earlier quoted context omitted.

You didn’t read the comment. It’s not about getting a job in a restaurant within 1 mile - but rather opening a restroom yourself in that radius.

Right. Your chef should be able to work anywhere that needs a chef. I don’t think it’s fair if they leave you without a chef and open a new restaurant selling the same kind of cuisine down the bock tomorrow. That seems more like a spite restaurant. And I’m ok with putting a simple time/distance limit on that. Next year? Nearby city? Different kind of food? Go for it tomorrow.

What do you mean, it’s not fair? I genuinely don’t see anything wrong with a “spite restaurant”.

I’ve tried to come up with a comparable situation where the roles are reversed. Suppose that you owned a restaurant. If you fire your chef and buy your local competitor, can the chef argue that this purchase shouldn’t be allowed because he can’t get a job in the local market anymore?

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#183

Post by lrem »

miohtama wrote: post #157
lrem wrote: post #155

Earlier quoted context omitted.

What about remote workers crossing country boundaries? Stuff is a lot of fun already, especially in Europe.

We are a fully remote 10 people startup. Everyone is in a different country, mostly in Europe. The only option to make it work is to have everyone as a contractor, because setting up legal entities that can do employment around the globe is not feasible for SMEs. Also there are some companies selling full employment and payroll option, reporting. They might work for large enterprises, but for us it is just easier to…

Then, there are countries with regulations against fictitious self-employment. They’ll happily decide that your foreign contractor has been a full time employee, with all the protections of their local law. They’ll also hand you an invoice for all the missing social security and whatever other payments, plus a fine for misreporting.

Payroll companies are, sadly, the way to go here.

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#184

Post by Conan_Kudo »

kweingar wrote: post #182
MBCook wrote: post #181

Earlier quoted context omitted.

Right. Your chef should be able to work anywhere that needs a chef. I don’t think it’s fair if they leave you without a chef and open a new restaurant selling the same kind of cuisine down the bock tomorrow. That seems more like a spite restaurant. And I’m ok with putting a simple time/distance limit on that. Next year? Nearby city? Different kind of food? Go for it tomorrow.

What do you mean, it’s not fair? I genuinely don’t see anything wrong with a “spite restaurant”. I’ve tried to come up with a comparable situation where the roles are reversed. Suppose that you owned a restaurant. If you fire your chef and buy your local competitor, can the chef argue that this purchase shouldn’t be allowed because he can’t get a job in the local market anymore?

It still applies even if the chef in question creates their own restaurant. This is literally how startups are born. Here in CT, a lot of pizza places are spun up by pizza people leaving a pizza place and creating their own.

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#185

Post by DrewADesign »

Conan_Kudo wrote: post #184
kweingar wrote: post #182

Earlier quoted context omitted.

What do you mean, it’s not fair? I genuinely don’t see anything wrong with a “spite restaurant”. I’ve tried to come up with a comparable situation where the roles are reversed. Suppose that you owned a restaurant. If you fire your chef and buy your local competitor, can the chef argue that this purchase shouldn’t be allowed because he can’t get a job in the local market anymore?

It still applies even if the chef in question creates their own restaurant. This is literally how startups are born. Here in CT, a lot of pizza places are spun up by pizza people leaving a pizza place and creating their own.

That's always been the way the restaurant business worked, but big chains actually have been using non-competes for a while. They claim their training, even for the front of the house, is that unique and valuable. Absurd.

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#186

Post by tony69 »

SideQuark wrote: post #72
nkrisc wrote: post #66

Earlier quoted context omitted.

Regardless of the specifics of any regulation, the burden should be on the company and should err on the side of the employee’s benefit. It’s never fair to pit an individuals livelihood against a corporation.

Can a salesman leave and take all his clients with him, even if there were given to him by the company?

Yes, happens all the time, and it’s not a big deal. There’s product and business strategies to help protect against that. Also, it’s not as easy as it seems, and in cases where it is, it’s good for the overall economy: competition lowers prices the right way (unlike mergers and acquisitions).

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#187

Post by nceqs3 »

loeg wrote: post #119
nceqs3 wrote: post #87

Earlier quoted context omitted.

How dare quants get paid $5m to sit on their couches for two years after leaving their firms! Congress must act!

The standard and legal minimum for WA employers is no compensation for the non-compete period. Also, the vast majority of workers that make more than $116k do not make $5 million annually, either before or after leaving their non-compete employer.

It would be 2.5 a year. Non competes are 2y across all of finance.

Re: FTC cracks down on companies that impose harmful noncompete restrictions

#189

Post by smeagull »

Mountain_Skies wrote: post #163
smeagull wrote: post #122

Earlier quoted context omitted.

I'd love that so much. I get paid a noncompete and can go on to work for someone else and how are they going to find out?

The Work Number, an Equifax service that a shockingly large number of employers provide data to. If your new employer is one of these, and it probably would be unless it's a startup or a small family business, your old employer can see that you're now employed and who with.

Giving employee data to Equifax sounds actionable.
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