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FTC announces rule banning noncompetes

ftc.gov

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Re: FTC announces rule banning noncompetes

#311

Post by fsckboy »

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.

for software patents they should have to disclose the sourcecode

Re: FTC announces rule banning noncompetes

#313

Post by EasyMark »

_xerces_ wrote: post #310
EasyMark wrote: post #275

I think the FAANGs are gonna come out on this one and take it all the way to the supreme court. I don't see this sticking at all, especially with the current SCOTUS

CA already makes non-competes unenforceable and aren't most FAANG employees in CA?

CA isn't federal law and this involves the FTC. Sure they could have taken them before but I think a nation wide limit might stir up the hornet's nest. FAANG have offices and data centers all over the country

Re: FTC announces rule banning noncompetes

#314

Post by m463 »

I'm not a senior executive, but I'm curious about:

"existing noncompetes for senior executives can remain in force."

So what happens to these people, are they stuck with the noncompete forever?

so if they leave, they can still be sued?

or is it that they can't start a competing business at the same time?

Re: FTC announces rule banning noncompetes

#315

Post by danaris »

freeopinion wrote: post #292
ClumsyPilot wrote: post #273

Earlier quoted context omitted.

> overworked USPTO granting clearly invalid patents Well no system can work that way - if judges in court were overworked and making invalid judgements, then the legal system would fail no matter what kind of laws you have and no matter what police does

These are pretty strange arguments. Why should an overworked USPTO lead to more patents? That assumes that the default is to grant the patent. If the default is to reject the patent, then an overworked office would not lead to more patents. An overworked Supreme Court does not lead to more Supreme Court decisions.

The problem is, it is in the interests of the wealthy and powerful that both those things be true—that the USPTO be so overworked they can't adequately review most patents, and that the default be to grant the patent.

And the wealthy and powerful use that wealth and power to influence how government functions.

Thus, the current situation.

Re: FTC announces rule banning noncompetes

#316

Post by TuringNYC »

k1rd wrote: post #253

With respect to garden leave agreements, as noted previously, commenters used the term “garden leave” to refer to a wide variety of agreements. The Commission declines to opine on how the definition of non-compete clause in § 910.1 would apply in every potential factual scenario. However, the Commission notes that an agreement whereby the worker is still employed and receiving the same total annual compensation and b…

> "same total annual compensation and benefits"

This would be a game changer. My experience with garden leaves was that the base salary remained but since the bonus and benefits were gone, the total comp was severely affected

Re: FTC announces rule banning noncompetes

#317

Post by noitpmeder »

TuringNYC wrote: post #316
k1rd wrote: post #253

With respect to garden leave agreements, as noted previously, commenters used the term “garden leave” to refer to a wide variety of agreements. The Commission declines to opine on how the definition of non-compete clause in § 910.1 would apply in every potential factual scenario. However, the Commission notes that an agreement whereby the worker is still employed and receiving the same total annual compensation and b…

> "same total annual compensation and benefits" This would be a game changer. My experience with garden leaves was that the base salary remained but since the bonus and benefits were gone, the total comp was severely affected

Sure, but to some degree bonuses are completely discretionary. A very bad year at some shops or on some desks could land you with a 0 bonus, although when that happens expect everyone to start looking for other jobs.

Re: FTC announces rule banning noncompetes

#318

Post by emidln »

bluGill wrote: post #222
o_nate wrote: post #155

Earlier quoted context omitted.

No, it just means that during the period after you stop working at the old job but before you can start working at the new job, you are paid only your base. This can be a significant reduction in total comp in industries such as finance.

I have worked jobs where the best bonus over 5 years was $500, while the typical year all we got was a promise that if things go well there will be a bonus. I've worked other jobs where the worst bonus was $15000 (a really bad year for the company), and could be up to $50,000. This is as a regular engineer, management can get a lot more. The first company taught me at until the money is in my account the bonus is mea…

In finance, it's common to see a base of 150,000 and a VR of between 300k and 750k for engineers. During garden leave, you get paid your $150,000 as part of payroll, but are ineligble for VR. Your total comp goes from 450,000 (in mediocre years) or 900,000 (in good years) to 150,000 for whatever your non-compete period is (6 months, 12 months, 24 months are all common).

Re: FTC announces rule banning noncompetes

#319

Post by jameshart »

mminer237 wrote: post #301
jameshart wrote: post #290

Earlier quoted context omitted.

Indeed. Government agencies are overseen by officers of the United States, appointed by the president with the advice and consent of the senate, typically to terms greater than the length of either a presidential to senate term. Just like Judges. The idea that courts are the only delegates of the elected representatives of the people who are allowed to figure out the nuances of how to carry out the democratically leg…

The Supreme Court often dismisses cases for the entire reason that constitutionally it can't make laws. That's Congress's job. It's fair to be critical of how much Congress can punt its responsibility to a 4th branch of government with little oversight.

Kicking back a law because it's constitutionally not the business of government to have laws that say that, is very different than kicking back a law because while it is something upon which legislation could constitutionally be had, and the executive is acting in accordance with the law as written, the judiciary doesn't like the way in which the legislature chose to phrase how it delegated authority... that's a different story.

Executive agencies aren't a "fourth branch of government with little oversight", they're article II section 2 'departments' of the executive, established by law, and controlled by the president and appointed officers, with as much oversight as congress legislates to require, plus accountability to the courts for remaining within the bounds of their legal and constitutional authority.

Re: FTC announces rule banning noncompetes

#320

Post by lamontcg »

cryptonector wrote: post #287
lamontcg wrote: post #188

Earlier quoted context omitted.

I suspect that "policy-making positions" is a term of art that is more narrowly defined than it looks and that it'll actually be difficult or impossible to abuse it enough to made it apply to SWEs. Most likely big 4 accounting firms have a definition of what that means and it is part of accounting and auditing standards. At any rate they'd need to first abuse it to apply to managers who are below VP levels.

It's defined in the rule...

Yeah, so its based on the SEC Rule 3b-7 definition of a company officer, only with some changes to make it even more restrictive to senior executives.

They're not going to be able to claim that a SWE is now the VP in charge of changing lightbulbs and is now a policy-making position. There is a whole lot of text in the rule about what a "policy making position" is, and I'm certain that there is a considerable amount of legal and accounting history behind that SEC Rule which will act as precedent.

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