The Supreme Court of Bottomless Dickheads.
Which will be the specter hanging over every progressive policy for the rest of my life.
I don't see a downside to ending non-competes. I think the tightening of the limits on who is exempt from overtime is a bigger deal.
No downside I see besides the people who will use the Texas federal courts as a second legislature. Good evidence it helped Silicon Valley develop from nothing.
It doesn't affect lower income people as much, but usage there seems to be growing, and when it does it's particularly unconscionable: check out the horrendous examples quoted on page 11 of the rulemaking document.
I guess it's possible bad actors might develop NDAs that are wide-ranging enough to have similar effects? But that will take more time and be trickier.
Gardening leave was a good compromise.
"You can't work for a competitor for a year" is a pretty clear rule;
"you can't use our secrets at a competitor" will mean more lawsuits.
Somebody will apply and extend the new doctrine of prohibition of non-compete to cover government workers
who leave to work for lobbyists or for government contractors.
Jimmy John's was having the sandwich makers sign a non-compete. They probably can't afford a garden.
6: That'd how it worked in MA and only for Senior Executives. You had to pay them garden leave to enforce it. Not allowed for physicians.
If you have someone who is salaried, how do you enforce the overtime rule. Like, I nake above that but I have coworkers who probably make less than that.
We rarely work over snd only if we choose to, and if there's not enough work to do, we leave early. I'd hate to have to punch in and out.
I don't know how hard it is to enforce the overtime rule, but I know a guy who will sue your employer or former employer if you didn't get paid overtime to which you were entitled.
Econolicious: "gardening leave" was the "penalty" enforced by non-competes. Literally, the non-compete would say "for a year after quitting, you can't work for a competitor". So people would have to not work for a competitor for that year, and if you were valuable enough, that competitor would pay you to sit in your garden.
Heebie, I'd say that you already have enough evidence for what the effect of this rule change will be, and it's going to be all bad. ALL BAD. Why, if we're not careful, we'll have California's economy breaking out all across the USA! Imagine it! The horror, the horror, the horror! California has made non-competes unenforceable forever. Nobody here even thinks about 'em. And I guess I'll leave it to you to discern what the effect of that is. *grin*
I know trade secrets and nobody seemed to worry that much when I worked with competitors knowing the prior company's trade secrets. But then someone maybe noticed that I spend meetings doing other work or reading Wikipedia while waiting to hear my name and they figured I'd get the secrets wrong.
10.1: different in the UK - https://www.gov.uk/handing-in-your-notice/gardening-leave
I think the UK one makes sense. If someone is so valuable to you that you want them to wait six months or whatever after leaving before they start work at a competitor, then you pay them for those six months.
Somebody will apply and extend the new doctrine of prohibition of non-compete to cover government workers who leave to work for lobbyists or for government contractors.
This is a very good point. And I can't actually think of a good argument against it. If it's a restraint of liberty for me to move from Microsoft to Oracle, why should we ban people from moving from the Treasury Department to JP Morgan?
I suppose you could say "you're welcome to leave government service and go to work immediately for whoever you like, but the government won't award contracts to a private company that employs anyone who left government less than a year ago, I hope your prospective future employer is aware of this?"
But that's a restraint by another name.
And, really, do we want a ban like that? If I am a completely honest person with no thought of peculation or abuse of privilege, and I work for the government procuring construction equipment, and I leave for whatever reason - maybe I want more money, maybe I want to work in a different city, maybe I don't like my boss - I'd be looking for a job selling construction equipment. And now no one's going to hire me for a year because if they do they won't be able to sell to the government, which is a big buyer. So I have to find a different job that I don't know how to do, with someone who never does any business with the government and who doesn't mind hiring someone who's inexperienced and will definitely leave in a year.
I made the mistake of reading something on Twitter. Non-competes aren't negotiable! It's not like you bargain for a job offer and trade an extra week of vacation in exchange for signing a noncompete. Have any of these people ever interviewed for an actual job?
re: 13
I think notice periods and gardening leave are slightly distinct, though.
My contract has provision for a non-compete clause and a notice period, but they aren't the same length of time. So, I think, iirc, that my notice period is 3 months, but I know my non-compete clause is 6 months. So my employer could choose to put me on gardening leave for 3 months, but I couldn't then start straight away at my new job (depending on the job).
My non-compete clause, if I recall, though, doesn't stop me taking a job at a rival company. It stops me poaching my existing company's business by either i) setting up my own consultancy and poaching the work I currently do, or ii) going to work directly for one of our clients,* i.e. the restriction is around existing clients for a period of 6 months. I could go and work for a rival consultancy working with clients other than the ones I currently have, as soon as my notice period is up.
Restrictive covenants of that type are, I believe, legally enforceable: https://www.gov.uk/handing-in-your-notice/restrictive-covenants
* a genuine risk, I think, in the space I work in.
I would love three months gardening leave.
I can't remember if I took my blood pressure medicine. I need one of those caps that tells you when you last opened the bottle.
10: usually it's not the competitor, it's your first company that pays.
The prohibition on poaching colleagues or accounts I've heard called non-solicitation agreements which I think are generally considered valid.
Now that I've parsed it, I don't think 6.2 is a good point. Rules about government employees not switching to their regulatees are usually laws or regulations, not non-compete contracts. (For example, in California, it's Government Code 87100 et seq on conflicts of interest, punishments by law including administrative fines, cease & desist orders, civil penalties.)
We can keep revolving-door policies on their own terms without non-compete bans interfering directly or via concept bleed. Different things are different!
19: Yes, I think that's right. How does that work with, say a hair stylist? Are they not allowed to tell their clients where they are going?
20: Yes, there's some conceptual overlap but as a matter of law those sorts of policies are totally separate and not affected by banning non-compete clauses.
They have to write it on their eyelid and wink.
Certainly someone could say "we banned non-competes so we should end revolving door policies". That would be a policy matter, not judicial. Plus I think they would be clearly enough wrong on merits it wouldn't get very far.
21: Typically, they are not. They also can't contact their clients directly after they leave.
25: I followed my stylist, and he told me where he was going. Doctors also sometimes say where they are going. But MA bans non-competes. I don't know what our law was on solicitation of clients.
SP: I clicked the link, and ended up at Alex Tabarrok (who cites Tyler Cowen). Uh .... I fear your mistake was not "reading something on Twitter" but rather, paying any attention to anything by those reptiles Tabarrok [spit] and Cowen [spit twice].
Cowen: "Why is the FTC forbidding employers for exercising their natural right of ownership over their employees?"
14: Given the power to bargain for better wages, a worker will accept less pay because bargaining power has value.
I find it hard to explain libertarians without speculating about brain damage.
Tempting an employee away from their employer can be tortious - see "seduction of servants", Lumley vs Gye, QB 1853