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U.S. moves to bar noncompete agreements in labor contracts

nytimes.com

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Re: U.S. moves to bar noncompete agreements in labor contracts

#351

Post by inetknght »

Zigurd wrote: post #62
TSiege wrote: post #3

This is a bigger deal then the title suggests since it appears it would be retroactive and nullify existing non competes > The commission’s proposal appears to address this issue by requiring employers to withdraw existing noncompetes and to inform workers that they no longer apply. The proposal would also make it illegal for an employer to enter into a noncompete with a worker or to try to do so, or to suggest that…

It isn't too unusual for humans to be protected from entering into unjust contracts.

> It isn't too unusual for humans to be protected from entering into unjust contracts.

Perhaps, but it is unusual for humans to be aware that they're protected from such.

Re: U.S. moves to bar noncompete agreements in labor contracts

#352

Post by blueprint »

dchuk wrote: post #13
blueprint wrote: post #5

this seems like a really bad idea. people can just join a company, get trained, then leave. hello corporate espionage.

There are still intellectual property laws in place that could protect the original companies. Non-competes stifle innovators at big companies from being able to leave and pursue their own ideas that are in the same domain as the parent company.

I'm not saying the existing solution is complete, either. But banning noncompetition itself is not the right answer. Why do contract noncompetes clauses exist? What about the small companies and inventors and IP owners? None of these replies I'm seeing have considered the side effects to the world except what would clearly also benefit giant companies.

Re: U.S. moves to bar noncompete agreements in labor contracts

#353

Post by deaddodo »

jacobr1 wrote: post #230
mumblemumble wrote: post #57

Earlier quoted context omitted.

This is the standard I knew from the trading industry. I would say that, while it does initially seem more palatable, it also has some downsides. One that might be particularly relevant to programmers is that it sets up a structure that functions somewhat like a penalty of 1 year's worth of paid vacation for choosing a new job outside the industry. I don't have the business or economic bonafides to back this up, but…

Even in California, you can get sued for violating an NDA when going to competitor if you bring private technical data, which seems like a reasonable compromise. You can bring your expertise, but no code. Intersecting with this are patents. A company can also protect its IP with patents, but when should choose to disallow, or have more liberal patent laws? It seems there are similar tradeoff between the value to comp…

> Even in California, you can get sued for violating an NDA when going to competitor if you bring private technical data, which seems like a reasonable compromise. You can bring your expertise, but no code. Intersecting with this are patents. A company can also protect its IP with patents, but when should choose to disallow, or have more liberal patent laws? It seems there are similar tradeoff between the value to companies, competitors and public interests.

What does that have to do with non-competes? What you're describing is IP law and theft; and is illegal pretty much throughout the western world.

Non-competes specifically and only exist in the context of barring employee competition and migration of talent. All via legal labor servitude at the justification of "training investment" and/or "unfair competition".

Re: U.S. moves to bar noncompete agreements in labor contracts

#354

Post by Digory »

gen220 wrote: post #282
Digory wrote: post #276

Earlier quoted context omitted.

In theory, it lowers the risk of hiring in certain situations. So, if the alternative is not hiring, that's beneficial. For a lot of companies, the "sauce" is a personal relationship that isn't trade secret. If you hire a salesman, and give them access to Mr. Big, you create an incentive for the employee to trade the relationship for your competitor's money. Penalizing the change in employer is not the only way to de…

That makes sense as to why an employer would want a non-compete. Is there some way that this translates into why "we the people" would want to allow companies to enforce non-competes? From my perspective, if a company's sauce is personal relationships, the non-compete is not particularly effective in engendering loyalty and extracting the greatest value from that relationship. A disaffected salesperson is not going t…

1. Shifting profits from the entrepreneur (with skin in the game of providing consumer wants) to the middleman can be deadweight. You'd want some evidence that rewarding disloyal middlemen results in we the consumer surplus, not just a flourishing middle-man economy.

There can be price-discovery benefits to middlemen, like market makers at the NYSE. But the financial markets usually involve fungible goods. Consumers seem to benefit from finding ways around the middlemen, though.

2. We the people have egalitarian ideals about jobs and opportunities. The old-fashioned way to 'lock in ' people to loyalty is to hire family or from the same social strata. Historically, those benefits have been distributed unfairly.

So the non-compete provides some mechanism for the "haves" to spread around opportunities to the "have-not-so-many-reasons-to-be-loyal," understanding that the law will enforce the agreement to be not-disloyal.

Re: U.S. moves to bar noncompete agreements in labor contracts

#355

Post by willcipriano »

lostdog wrote: post #266
r00fus wrote: post #226

Earlier quoted context omitted.

How did the supposed captured government agency (FTC) happen to even propose this? Is it a) FTC is not captured b) proposal that goes nowhere (ie, Lucy with the football scenario) or c) perhaps that "group politicians really care about" realize the gains may be worth the cost ?

The FTC is a bit less captured currently because of its current head.

If this is accomplished I'll believe you.

Re: U.S. moves to bar noncompete agreements in labor contracts

#356

Post by runarberg »

weakfortress wrote: post #149
ajsnigrutin wrote: post #19

I understand noncompetes in some fields... but this can be solved in other ways. In my country (slovenia), a noncopete is valid only if you're being financially compensated by some amount while the noncompete lasts. It's a bit complicated here, but ideally companies wanting noncompetes could be forced to pay the difference between what the worker would've earned if they stayed (+ some safety factor for a potential ra…

I don't understand them in any field. I was forced into signing one for tech that blocks me from working from any competitor for up to 2 years. Depending on how loosely you define competitors that could mean I can't work in tech for 2 years after this job. Unfortunately for me I can't afford a lawyer. Fortunately for me non-competes of this level are generally unenforceable. You have NDAs already. It's not like you'r…

The power imbalance is such that it won’t matter if a non-compete clause is enforceable or not. If it scares former workers from trying, they are in effect despite never actually being enforced. I think this is probably true of most workers which sign them.

Re: U.S. moves to bar noncompete agreements in labor contracts

#357

Post by prottog »

duped wrote: post #232
prottog wrote: post #133

Earlier quoted context omitted.

> This is actually super interesting in that Article 1. Section 10 suggests this requires Congressional approval. The UCC is not an interstate compact in the sense of Article 1 Section 10. They're merely the same code that each state chose to adopt, with no legal ability for any other state to question if one state chooses to deviate from it in part or whole. It absolutely does not require Congressional approval. Int…

> You're absolutely right that state sovereignty has been steadily eroding, and I posit that this is to everyone's disadvantage. The evidence suggests otherwise. When states wield their power on rights, it's usually against the interests of their people until the federal government forces them to stop by removing their power to do so. That doesn't mean the federal government is without issue, but it is the entity des…

> The evidence suggests otherwise. When states wield their power on rights, it's usually against the interests of their people

States decriminalizing pot, for one, would be an example of state law trying to broaden liberties that federal law restricts. Or Massachusetts legalizing same-sex marriage long before the US Congress did anything about it. Or even at a smaller level, San Francisco city officials doing so before the state of California did.

There's plenty of examples where a more local decision went in furtherance of liberties than a more distant decision, so I'm not sure where you get the idea that politicians become more enlightened and virtuous the higher up in the federation they go.

> The existence of this as a state law would only serve to exist in opposition to states that don't, to the detriment of their citizens.

I'm not sure I follow. I think it's perfectly fine to let the fifty laboratories of democracy play this out, keeping the locus of control as close to the people as possible. The people of California have shown that the lack of noncompetes doesn't necessarily impede commerce or progress; the people of other states may learn from that and follow, or decide otherwise. And if those states that keep enforcing noncompetes do end up doing poorer for their people, they will change the law, or vote with their feet.

Re: U.S. moves to bar noncompete agreements in labor contracts

#358

Post by deaddodo »

1vuio0pswjnm7 wrote: post #293
ecshafer wrote: post #21

Non-Competes being legal is only acceptable I think if the worker will continued being paid for the period of the non-compete. I can see reasons that non-competes exist, but those reasons don't really make sense in a world where patents and trademarks also exist. The fact that they are essentially illegal in California, and California's economy works shows that they are unnecessary and also don't hinder technological…

"The fact that they are essentially illegal in California, and California's economy works shows that are unnecessary and also don't hinder technological development." If there were another US state where noncompete agreements were "essentially legal" whose economy "worked" what would that show. Are there any other factors one should consider that affect whether a state's economy "works". Is it possible to work for a…

I mean, if you want the counter example; we already have it. Texas and Massachusetts both had much more developed and supported engineering industries + talent pools in the first half+ of the 1900s. Talent specifically moved to California to be able to innovate without the encumbrances of current legislation in those states.

Sure, it's more complex than that and there are other reasons. But ultimately, a single piece of legislation had a huge hand in turning California into the preeminent global leader in the vast span of technology industries.

Re: U.S. moves to bar noncompete agreements in labor contracts

#359

Post by danaris »

chadash wrote: post #275
monksy wrote: post #252

Earlier quoted context omitted.

Non-competes do not protect an organization against IP theft or trade sceret dismenination. Those are portected by NDAs, confidentiality agreements, copyrights, patents, etc. Non-competes limit where your staff can go to. Without proper compensation for the time period in which they apply for, they're a very one sided (and in some cases illegal [NCs are legal in IL unless they assert an economic hardship]) way to pre…

> Those are protected by NDAs, confidentiality agreements, copyrights, patents, etc. This gets thrown around HN a lot but I don't think it matches reality. Say I work in machine learning algorithms for show recommendations at Netflix. Amazon hires me to work on their machine learning algorithm recommender on Prime Video. Sure, I might have NDAs to protect what I learned at Netflix, but how does Netflix realistically…

> It's not like they can just ask to see Amazon's code to see if the knowledge has been ported over to there.

Probably not, but I would imagine that in cases like this there would be a third party given access to both sides, and charged with determining if theft has occurred.

Re: U.S. moves to bar noncompete agreements in labor contracts

#360

Post by worik »

chadash wrote: post #275
monksy wrote: post #252

Earlier quoted context omitted.

Non-competes do not protect an organization against IP theft or trade sceret dismenination. Those are portected by NDAs, confidentiality agreements, copyrights, patents, etc. Non-competes limit where your staff can go to. Without proper compensation for the time period in which they apply for, they're a very one sided (and in some cases illegal [NCs are legal in IL unless they assert an economic hardship]) way to pre…

> Those are protected by NDAs, confidentiality agreements, copyrights, patents, etc. This gets thrown around HN a lot but I don't think it matches reality. Say I work in machine learning algorithms for show recommendations at Netflix. Amazon hires me to work on their machine learning algorithm recommender on Prime Video. Sure, I might have NDAs to protect what I learned at Netflix, but how does Netflix realistically…

> Sure, I might have NDAs to protect what I learned at Netflix, but how does Netflix realistically show whether or not I disseminated that knowledge at Amazon?

Personal integrity. If you have it, you are valuable. If you do not any value you have is short lived.

Cuts both ways. Does Amazon have the integrity to not expect the violation of your agreement with NF?

Life is simpler with honesty

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