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FTC votes to ban non-compete agreements

Deft Beck

Deft Beck

Member
6sbTa9K.png


thehill.com

FTC votes to ban noncompete agreements

The Federal Trade Commission (FTC) voted 3-2 Tuesday to ban noncompete agreements that prevent tens of millions of employees from working for competitors or starting a competing business after they…
thehill.com thehill.com

The Federal Trade Commission (FTC) voted 3-2 Tuesday to ban noncompete agreements that prevent tens of millions of employees from working for competitors or starting a competing business after they leave a job.

From fast food workers to CEOs, the FTC estimates 18 percent of the U.S. workforce is covered by noncompete agreements — around 30 million people.

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Though I have never experienced this myself, I think it's a very pro-worker move.
 
NickFire

NickFire

Member
I'm not sure they have the legal authority to do that, and I do not agree with any agency making law in the absence of a lawful delegation of power to do that. But if they have the legal authority or it is granted to them for this, then I would support the measure provided there is a carve out for the most senior people in a big company. Exactly where the line should be drawn is more complex, but something akin to an exception for the positions that come with golden parachutes would be my general thought process.
 
AJUMP23

AJUMP23

Parody of actual AJUMP23
Non-Competes has been an industry standard for a long time. I foresee a lot of unintended consequences. I do think it is good to work someplace, take what you have learned and go do your own thing. I wonder if there will be a increase in IP lawsuits.
 
Hudo

Hudo

Gold Member
Good. Non-competes are companies behaving like whiny little bitches. Companies should man the fuck up.
 
Mistake

Mistake

Member
FullMetalx117 said:
I'm on a non-compete...this may actually be a game changer. Need some time to think about potential consequences. Initial thoughts are is that it's def a pro worker move. But perhaps it gives some companies more power in poaching talent with big pay days...rich get richer?
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I understand the idea that a business wouldn't want their ideas going to another company for a set time, but that's the consequence of not retaining your employees. I view non-competes the same as slavery. You're claiming ownership over someone, which is wrong. So how about treating them better instead?

Is there even a good severance pay when non-competes are involved? I'd make that mandatory at least
 
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R

Rival

Gold Member
Government Bureaucrats doing Government Bureaucrat things. Making new rules whenever they want at the direction of the fools who appointed them.
 
T

Tertullian

Member
Non-competes are bullshit, but how the fuck does the FTC have the authority to make such a wholesale change in the law? They're not the legislature. This is very obviously not just a change in enforcement strategy.
 
D

Deleted member 1159

Unconfirmed Member
Tertullian said:
Non-competes are bullshit, but how the fuck does the FTC have the authority to make such a wholesale change in the law? They're not the legislature. This is very obviously not just a change in enforcement strategy.
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Who do you think created the FTC and appoints its members? How do you think other regulatory bodies work? The system isn’t perfect but when it comes to specific regulation, having relatively competent experts vote in a matter seems to work better than having to convince Huckleberry Cousinfucker in the house to vote the right way.
 
NickFire

NickFire

Member
Mistake said:
I understand the idea that a business wouldn't want their ideas going to another company for a set time, but that's the consequence of not retaining your employees. I view non-competes the same as slavery. You're claiming ownership over someone, which is wrong. So how about treating them better instead?
Click to expand...
I sort of agree and disagree at the same time. I do think non-competes can and have been abused at times. Someone with 10 years of experience and no right to work within their field can end up feeling trapped. But on the other hand, training new people in some jobs can result in a significant investment by the employer before the employee can really produce anything for them. It is kind of messed up, from the employer's perspective, to pay someone to learn and have them quickly leave for a company that pays more after they are already trained (without having floated the salary during training).

Ultimately, there are pros and cons for each position, and society needs to determine who should bear the consequences of having or not having non-competes. I personally side with prohibiting them if we are all voting, except with higher level people who get massive payouts when they leave.
 
NickFire

NickFire

Member
Thaedolus said:
Who do you think created the FTC and appoints its members? How do you think other regulatory bodies work? The system isn’t perfect but when it comes to specific regulation, having relatively competent experts vote in a matter seems to work better than having to convince Huckleberry Cousinfucker in the house to vote the right way.
Click to expand...
There is a difference between being delegated authority and claiming that authority was delegated years prior without anyone realizing it. I think the poster you replied to was clearly referring to the latter scenario.
 
D

Deleted member 1159

Unconfirmed Member
NickFire said:
There is a difference between being delegated authority and claiming that authority was delegated years prior without anyone realizing it. I think the poster you replied to was clearly referring to the latter scenario.
Click to expand...
That makes sense. I guess that’s where the court challenges will have to decide.
 
M

Moneal

Member
jason10mm said:
I'm under a non-compete. Mixed feelings on this, while it enhances my ability to float around like a butterfly because I'm at the top of my field, it also reduces a company's ability (or desire) to invest in new talent.
Click to expand...
yep this is just going to cause companies to require experience for hiring even more than they do now.
 
ReBurn

ReBurn

Gold Member
jason10mm said:
I'm under a non-compete. Mixed feelings on this, while it enhances my ability to float around like a butterfly because I'm at the top of my field, it also reduces a company's ability (or desire) to invest in new talent.
Click to expand...
Noncompetes don't reduce a company's ability or desire to invest in new talent. They can still fire you and replace you with someone else. All a non-compete does is prevent you from working somewhere else if you want to. Noncompetes do not protect workers in any meaningful way. If your company values your skills at that high of a level they'll have you on a retention plan that pays you more than your skills could earn you somewhere else instead of forcing you to sign away your rights in exchange for severance pay.
 
J

jason10mm

Gold Member
ReBurn said:
Noncompetes don't reduce a company's ability or desire to invest in new talent. They can still fire you and replace you with someone else. All a non-compete does is prevent you from working somewhere else if you want to. Noncompetes do not protect workers in any meaningful way. If your company values your skills at that high of a level they'll have you on a retention plan that pays you more than your skills could earn you somewhere else instead of forcing you to sign away your rights in exchange for severance pay.
Click to expand...
Eh, if you need training in a field, can get it from one company, and then bounce it's a pretty strong disincentive to want to train folks. Obviously there are work around for it but was there really a lot of backlash against noncompetes?
 
StreetsofBeige

StreetsofBeige

Gold Member
For most people this will have no effect because most people arent high profile enough to even have non-competes in their employment contract. I dont have a non-compete in my employment despite knowing all the numbers, which I can technically bolt and spill the beans to any competitor. But in finance, for whatever reason we dont have that. Even the VP doesn't because they bolt from peer company to peer company too. So for anyone in a non-compete it must be some ultra exec level job or you do some really secret shit that is so important it can sink the company.

No more non-competes is god for workers, but bad for companies. Now that guy can get hired, leave after 6 months and take his confidential info to a new company. Lets face it, people have loose lips. I've seen people show us sheets from their old company. They are not maliciously doing it. But they are like... "here's some cool reporting stuff from my last place.... oh just ignore the numbers". Well, the numbers they are pretty who cares so no big deal. But for any confidential info, non-competes are lets say two years long, so as time goes the possible downsides get smaller as the info can be outdated.

Only people with highly sensitive info(?) will be getting non-competes unless it's a weird company that blankets it to even an entry level accounts payables clerk. Companies will be more weary hiring people I'd guess because they now any new hire who would go under non-compete might bolt shortly after.
 
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gothmog

gothmog

Gold Member
I have been under non competes for years. It has never really stopped me from getting hired. They are almost impossible to enforce in tech unless you are really high up in the leadership or research food chain.

They should have banned them years ago, though. Just sue the companies who lean on their employees to spill their previous employer's secrets. Much easier to enforce and does not ruin lives.
 
Bridges

Bridges

Member
It's my understanding that non-competes rarely held up in court anyway, but still a good move to be sure. Even if they were often not enforceable they still acted as a deterrent/scare tactic to employees. This should (hopefully) be a non-partisan win for the working class.
 
M

Marlenus

Member
NickFire said:
I sort of agree and disagree at the same time. I do think non-competes can and have been abused at times. Someone with 10 years of experience and no right to work within their field can end up feeling trapped. But on the other hand, training new people in some jobs can result in a significant investment by the employer before the employee can really produce anything for them. It is kind of messed up, from the employer's perspective, to pay someone to learn and have them quickly leave for a company that pays more after they are already trained (without having floated the salary during training).

Ultimately, there are pros and cons for each position, and society needs to determine who should bear the consequences of having or not having non-competes. I personally side with prohibiting them if we are all voting, except with higher level people who get massive payouts when they leave.
Click to expand...

Length of service agreements post training are not the same as a non compete.

A training provision will say that they require 2 years of service post training and failure to comply means the company can charge the employer for the training on a pro rata basis (so if the employee did 1 year than bounced they would need to cover half the training cost).

Non competes are often overly broad and say you cannot work in the same field for a year or more.

Imagine how stupid it would be if in F1 drivers or engineers had non compete clauses so to move team you had to not work for a year or more. It would kill the sport. Could you imagine the uproar if RB tried to saddle Newey with a non compete preventing him from joining a different team.
 
GHG

GHG

Member
Mistake said:
I understand the idea that a business wouldn't want their ideas going to another company for a set time, but that's the consequence of not retaining your employees. I view non-competes the same as slavery. You're claiming ownership over someone, which is wrong. So how about treating them better instead?

Is there even a good severance pay when non-competes are involved? I'd make that mandatory at least
Click to expand...

A lot of the ideas in business come from their people though.

The idea that a company should have ownership of you and your ideas/knowledge is nonsense.

Time for these big companies who tend to implement this kind of thing to man up and embrace competition.
 
Cyberpunkd

Cyberpunkd

Member
NickFire said:
provided there is a carve out for the most senior people in a big company
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Why? Non-compete is a dead document, same with NDA. Proving anything is incredibly difficult, takes ages and costs lots of money. If senior management wants to use their insider knowledge they will find a way to do that without anyone knowing.
 
Punished Miku

Punished Miku

Human Rights Subscription Service
Should definitely be banned. Corporations can worry about the fallout without restricting people's rights to work.
 
NecrosaroIII

NecrosaroIII

Banned
Anything that isn't copyrighted, trademarked or patented is fairgame IMHO. Fuck em. They don't want people going to competition, then they should work harder to retain.
 
Yoda

Yoda

Member
Non competes are generally abused. Cookie cutter contracts are given to non specialized employees to drive down the overall cost of labor. Very good ruling.
 
Sub_Level

Sub_Level

wants to fuck an Asian grill.
Great news for workers. My last job was pretty low-tier and I still had a noncompete that said I couldn’t work for other firms in the same industry on the side.
 
chlorate

chlorate

Member
Why do we even bother with Congress if the FTC has the power to drastically reinterpret laws to overturn decades of agency policy on a whim like this?

If nonconpetes are so bad it shouldn’t be hard to legislate them out of existence
 
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Y

YCoCg

Member
simpatico said:
You think American politicians are passing labor laws "for the people"?
Click to expand...
Isn't that what they're supposed to do? I get the cynicism but this does feel like a rare case where America is catching up with other countries in terms of employment law.
 
T

taylor34

Neo Member
This is a good first step. So many companies today setup bullcrap compensation where they can threaten to claw back compensation if you try and work anywhere else (or outright preventing you), meanwhile lowballing your current compensation trapping you in doom loop. The way it's setup today is the first thing they do is make you sign a non-compete (before you can even start work, a lot of times not telling you that until the first day of work so you have little recourse as you've already quit your other job) then basically setup your compensation in a way that the company can says they can claw part of it back or prevent you from taking another job...then proceed to underpay you so you're threatened that you can't leave to another company, but also we're not going to pay you market rate either.

This whole system needed to be banned, and this was a good first step in it. I think originally they were just using it for top execs (which made some sense due to their excessive compensation) but then companies got greedy and basically blanketed it to everyone.
 
Puscifer

Puscifer

Member
Generally speaking has anyone ever gotten in trouble for a non compete? I've signed two, one when I contracted at Google (not as glorious as it sounds) and another for a job I can't remember but I can't seem to think of it stopping me from working on the industry
 
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