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The case for banning non-competes

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Re: The case for banning non-competes

#261

Post by runnerup »

wolverine876 wrote: post #91
trentnix wrote: post #62

Earlier quoted context omitted.

But my employer does everything. There is no field that my employer is not involved in, somehow. You can guess who they are, probably, or just read my profile. And they say "You cannot do anything that competes with anything we do". Which is everything. Want to make a Sudoku app? That's a game, we do games. Want to do some open source ML library work? We do ML, you can't do ML outside of work (I asked legal that one)…

> They implored me to trust that they had "never sued anyone" and "have no intentions to", and I think they honestly believe that. But then why have the non-compete at all? Exactly. 'That's great; we can resolve that issue easily. Let's just skip the non-compete - you're not using it anyway and I'm not comfortable with it.' EDIT: A non-lawyer's suggestion (talk to a lawyer before you do this): Skip signing or edit do…

> EDIT: A non-lawyer's suggestion (talk to a lawyer before you do this): Skip signing or edit documents (cross out and initial sections you don't like, add words - and initial each change) and then sign and send it back. Don't say a thing; leave it to them to bring it up - most people won't bother disputing it with you.

My actual lawyer's advice is that doing this can be viewed by a court as "fraud" if it looks like the intention was for the counter-party to miss the changes. It's their problem if they miss changes, but it's your problem if you used deception to cause them to miss it. This exact thing that you suggested is what he told me I shouldn't do if I want it to hold up in court.

I ended up signing a contract that said "cannot work for any customers, competitors, or suppliers for twelve months" of a global company that worked with every industry and most companies. I went the route of hiding my next jobs in LinkedIn after I left.

Re: The case for banning non-competes

#262

Post by walshemj »

masklinn wrote: post #48
mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> There are two kinds of non-competes, and both have problems. There are more kinds of non-competes. Neither of the kinds you're listing is blanket-legal anywhere in Europe, as far as I can tell, but there are still NCC/NCAs. Generally speaking, in Europe, NCC/NCAs must: * show a reasonable business interest, mere competition does not ever qualify * be geographically limited * be temporally limited (rarely more than…

And normally in the UK and a believe Europe the more senior you are the more likely a NC would be valid.

Re: The case for banning non-competes

#263

Post by mattkrause »

gibba999 wrote: post #25
PragmaticPulp wrote: post #5

My state has severely limited non-compete agreements to the point that they’re only narrowly enforceable, if at all. That didn’t stop one of my previous employers from using non-compete scare tactics against employees. Many of us left in a large exodus when benefits and bonuses were cut and management made a number of other bad decisions. The company responded by sending remaining employees an e-mail with a list of c…

My experience is that (1) Most threats like this aren't legally credible (2) That doesn't stop employers from filing (and losing, if not settled) lawsuits. For most employees, a lost lawsuit means you lose 2 years of your life, get PTSD, and go bankrupt. You might recover legal fees after you've lost the house. Yay! If you've got a megabuck, you're okay. If you live paycheck to paycheck, you're SOL. If you're a high-…

Can you elaborate on the grad student NDAs?

I'm surprised, because this seems like it would undercut the whole point of grad school (i.e., publishing) and it's very different from my experience (NDAs limited to patient data, etc).

Re: The case for banning non-competes

#264

Post by walshemj »

tshaddox wrote: post #32
mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> Obviously, if I work as a developer making a stock trading app, I shouldn't be making a competing stock trading app after hours. Why is that obvious? If I work as a studio musician can I also be working on my own album after hours?

Yes that's a totally different employment relationship - you could be sued for plagiarism though.

Re: The case for banning non-competes

#265

Post by heavyset_go »

mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> Obviously, if I work as a developer making a stock trading app, I shouldn't be making a competing stock trading app after hours.

As long as you're not using resources from your employer, including things like IP or trade secrets, then it's not so obvious to me.

What you do on your own time with your own resources is your own business. If that's seen as competition, then that's just too bad. This is how free markets work.

Re: The case for banning non-competes

#266

Post by jedimastert »

tshaddox wrote: post #32
mabbo wrote: post #23

There are two kinds of non-competes, and both have problems. First, there's the really nasty ones saying "If you ever work here, you can't work for any competitor for X years", and they're clearly abusing of employees, labor, etc. I hope there is a straight up ban on that. The second kind is "You can't compete with us while you work here". And that is a much more complex beast. Obviously, if I work as a developer mak…

> Obviously, if I work as a developer making a stock trading app, I shouldn't be making a competing stock trading app after hours. Why is that obvious? If I work as a studio musician can I also be working on my own album after hours?

The implication isn't that you can't work in the same field, but that you could use inside knowledge trusted to you as an employee to get a leg up, which would be more analogues to taking licks and ideas from a hit album and using them in your own.

Re: The case for banning non-competes

#267

Post by iammisc »

lostcolony wrote: post #96
brightball wrote: post #64

Earlier quoted context omitted.

In right to work states, non-competes can’t prevent you from earning a living.

De jure, maybe, but de facto it most certainly can, as the OP's anecdote attests to.

My business law professor said to just ignore non-competes. Everyone knows the judge will toss it if it's preventing you from earning a living. Any state that allows non-competes has statutory provisions for earning a living. If not, this is part of the common law in every jurisdiction. Non-competes cannot conflict with the public policy. Except for very few instances in which the previous company must show that the competition produces actual harm, they are completely unenforceable. Moreover, they must be geographically limited.

The Alabama, entire state ban, is likely overly large. A citizen of Alabama has a right to work in Alabama. Maybe they can't work in Birmingham for a year or two. But they must be able to work elsewhere in the state. This one could safely be ignored.

One thing I will note is that some companies want you to sign a contract upon leaving not to compete. Usually these are for some amount of money. These can be enforceable. However, they can't required for you to leave (although the bonus can be conditional on it). Don't sign these. They're dumb.

Companies know this too. As do hiring companies. For some reason though (and companies don't want you wisening up), many employees fear their old employer and choose not to apply, get scared, and run away. This is toxic, and it ought to be prosecuted IMO, but in the meantime, you should ignore it.

Source: https://www.bradley.com/insights/publications/2021/03/everyt...

Re: The case for banning non-competes

#268

Post by hosteur »

nfriedly wrote: post #252
seanhunter wrote: post #197

Had a fun one just happen to me in the last few days. I got contacted by an agent out of the blue. "Hey Sean we've got a role that you seem perfect for, just sign this NDA so we can talk." I look at the NDA and it includes a noncompete for the duration of the project + 12 months after. The nda is also not mutual so the noncompete and nondisclosure is only binding on me not the other party. In fact I don't even know w…

I used to freelance in the past, and I always charged extra for signing NDAs other than my standard one. Usually it turned out that my standard one was good enough after all, but sometimes I actually got paid for signing the client's "special" NDA. I've never seen any one that egregious, though. I'd charge quite a lot to sign that.

May I ask how much you charged extra for signing the NDA? And was it a one time fee, or a different rate or was it a recurring fee while the NDA was in effect?

Re: The case for banning non-competes

#269

Post by simfree »

lostapathy wrote: post #154
trentnix wrote: post #62

Earlier quoted context omitted.

But my employer does everything. There is no field that my employer is not involved in, somehow. You can guess who they are, probably, or just read my profile. And they say "You cannot do anything that competes with anything we do". Which is everything. Want to make a Sudoku app? That's a game, we do games. Want to do some open source ML library work? We do ML, you can't do ML outside of work (I asked legal that one)…

I had an employer hit me with an even more egregious non-compete. It said I couldn't work for 12 months for anyone in a market they were in, or in any market their competitors worked in. Our little sub-$1million startup was selling devices that competed with devices from a bunch of mega players like Dell, IBM and Amazon. Who's left to work for if you can't work for anyone who competes with Amazon?

I have seen multiple small companies that contribute to the CNCF demand their employees sign noncompete agreements like this.

Even working a retail job would violate this agreement, as that is a market their competitors are in (despite it having no relation to cloud tooling!)

Re: The case for banning non-competes

#270

Post by iammisc »

PragmaticPulp wrote: post #5

My state has severely limited non-compete agreements to the point that they’re only narrowly enforceable, if at all. That didn’t stop one of my previous employers from using non-compete scare tactics against employees. Many of us left in a large exodus when benefits and bonuses were cut and management made a number of other bad decisions. The company responded by sending remaining employees an e-mail with a list of c…

There should be a phone number you can call that basically tells you the answer as to whether you should apply for a job and ignore the non-compete. It could just be a pre-recorded message saying "Yes".

No state is going to want to protect monopolies over the employability of its citizens. No one wants you to become dependent on the government dole.

The vast majority of non-competes are unenforceable. If you're unlucky enough to actually be in an enforceable one, the chances are you already have a relationship with a lawyer.

Seriously, why do employees worry about this.

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