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Fair Compensation For Non-Compete Clauses?

Cliff posted more than 13 years ago | from the getting-paid-for-enforced-time-off dept.

News 199

LL writes "This article notes how non-compete job contracts allows indirect control of one's actions, even after leaving the direct employment of a company. Apart from the business ethics of using them as anti-competitive measures (a separate topic by itself), the question is what should be a fair compensation for removing yourself from the technology environment where skills suffer alarming bit-rot? Other sectors (e.g. banking) have 'gardening leave' where they basically pay you to remove yourself from the 'inner fraternity' before joining a competitor, but what should be a fair compensation for an enforced pause in your career? 6 months @ 150% base pay? 200% @ 3 months? Or are there standard clauses that IT workers have widely accepted as the norm?"

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Value of stock options, specific agreement (1)

Anonymous Coward | more than 13 years ago | (#391929)

In my situation, when my company got acquired, they made it clear that what I got in exchange for signing the non-compete was the value of my stock options. Which in my case was considerable, and it was also made clear to us that all senior people needed to sign it or the acquisition would not go through.

My non-compete was pretty specific (can't work on products that are in the same market that the product I was working on addresses), so it doesn't limit my options very much. There are a lot of other interesting jobs in my area that are in companies that do not sell products in the market space that my non-compete covers.

In my situation, given that it was necessary for the acquisition to go through (which was a huge windfall for me), and that it only limited my options a little, I decided to sign it.

VA Linux stock spirals ever downward: Now at $3.50 (1)

Anonymous Coward | more than 13 years ago | (#391930)

How about a topic dedicated to the imminent destruction of VA Linux and to the spinoff of its holdings, such as Slashdot, for instance?

Re:What's the core (1)

Anonymous Coward | more than 13 years ago | (#391931)

Oh christ. These incoherent mumblings get modded up to +3. Unbelievable. What the hell is your point? I do not understand the moral of this story, and I seriously doubt that is entirely my fault.

And don't provide "salary history" on resumes. (1)

Anonymous Coward | more than 13 years ago | (#391932)

Of course, they can't require you to provide salary history, but we all know what happens if you don't. Your resume goes into the circular file. IMO it needs to be made illegal to even ask for salary history.

The same is true with non-compete clauses. When every company inserts them into employee contracts and says "sign or we won't hire you", then the argument of "just don't work there" might as well be reworded to say "find a new job field to work in". Not a valid option. And while they may not be enforcable (as in California), non-compete clauses need to be outlawed and outlawed retroactively.

They are legal and can be enforced. (2)

Anonymous Coward | more than 13 years ago | (#391934)

This knowledge comes from a law class I had, I am not a lawyer just a Comp Sci who as part of one of my degrees had to take some legal classes. The teacher was a lawer who had just won a case for an employeer who sued sued a former employee. 1) They are enforceable, if you told to sign one expect the employer to enforce it. 2) Generally they are limited by some geographical location, a common example for this are local news readers most will an agreement not to go work for another local tv station. 3) They have to be limited by some period of resonable time. Designed to prevent competition with the company. 4) You generally have to have a high skill level to make it enforceable. A burger flipper is unlikely to have a court enforce one however if you were the person who designed the food for some fast food restaurant expect to have a court prevent you from starting up a similar fast food restaurant. As expect a court to enforce it more if you have a PHd then if you never graduated HS, you were smart enough to know what you signed when you signed it. 5) They can only prevent you from a similar type of job. If you are a highly skilled network person, then they probably cannot prevent you from taking a job doing non-network C++ programming. That all said, there have been exception for example read the tale of the founder of Atari, who then went to form Chucky Cheese pizza or Perot after he sold his computer consulting company.

Re:Is non-compete even legal? (2)

Zachary Kessin (1372) | more than 13 years ago | (#391935)

They can be it depends on which state you live in and how it is worded. They can not prevent you from earning a living. What you really need to do is talk to a lawyer because it depends a lot on how it was worded.

They can prevent you from taking information you got inside the company (trade secrets etc) and using them else where.

Re:Freezing IT (1)

tzanger (1575) | more than 13 years ago | (#391936)

Twice in AM did I temporary lock out two different IT Specialists.

Huh?

One was because he going to porn sites, then, deleting the records in the ADC of it, and the other was because he was viewing other people's emails.

Okay, these are reasons for termination, not pros for making people sign non-competetion agreements.

Their contracts allowed me to suspend them upto three months at only 50% advanced pay and that they weren't allowed to work in the same field during that time.

That's all fine and dandy... I really don't know what that last point has to do with getting terminated/suspended for doing something wrong.

Re:Don't do it. (1)

Nicolas MONNET (4727) | more than 13 years ago | (#391938)

They asked me to sign a contract a bit like this (but with completely unrelated clauses) in my previous job. I said "sure", never signed it. They asked me again, said I had it at home, that I would bring it back. I've never signed it.

--

Often entirely reasonable (2)

HEbGb (6544) | more than 13 years ago | (#391939)

Now, while the signing of a noncompete agreement doesn't make a lot of sense when you're working in a generic IT/maintenance job, it often makes a GREAT deal of sense when working in a more specific technology company.

If I hire an engineer to develop products for me, I am absolutely within my rights and reason to ask that they do not perform the same services for a competitor for a certain time after their employment with me expires. Otherwise, it would be very easy for someone to come into my company, soak up my technology, business plans, and clients, and then give me the finger as he or she leaves to a cushy job at my main competitor, who would be happy to pay a premium for my business secrets.

Proving that information was moved from one company to another is almost impossible - but a noncompete agreement can do a great deal to help maintain the employer's IP. Nothing wrong with that at all; I don't understand why people are decrying this so much.

A possible compromise is to list, in the contract, the specific industries or product areas which are off-limits. This would give the employer the protection they deserve with the flexibility the employee deserves.

Re:Don't do it. (2)

deeny (10239) | more than 13 years ago | (#391946)

?? an offer without mentioning a non-compete and you accepted it, you have a contract. If they add additional strings to it with a "do-or-die" clause, they have breached.

That's pretty straightforward, no?

In the case of a company that came by with a new "agreement" I simply point out that an agreement isn't binding without all six elements of a contract, one of which is that each side has "valuable consideration." If they want to offer me valuable consideration (continued employment is insufficient) for signing an additional agreement, well, we'll have to negotiate that.

One example is the "agreement" passed around at Linuxcare about the new employee handbook. It purported to cancel all previous contracts (such as the one for salary and stock options). I returned my own form stating that I had read and unerstood the employee manual -- but not that I'd agreed to it. No one ever said a word.

Unfortunately, I've *had* to learn to be tough as nails in this business because, over 25 years, I really HAVE seen every kind of sleazy stunt pulled.

_Deirdre

Re:Don't do it. (2)

deeny (10239) | more than 13 years ago | (#391947)

That should read:

"If a company makes you an offer without mentioning a non-compete and you accepted it, you have a contract."

I previewed it and it looked fine, it just garbled upon posting. Gar.

_Deirdre

Non-compete clauses in California (5)

deeny (10239) | more than 13 years ago | (#391949)

Since so many geeks are in California but are asked to sign non-competes anyway, I thought I'd give a pointer to California law. I remember another section but couldn't find it quickly.

California Business & Professions Code 16600-16607 [findlaw.com] .

Special point of interest:

16600. Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.

Note: IANAL

Reality Check (2)

The Dodger (10689) | more than 13 years ago | (#391952)


If you are stupid enough to sign an employment contract which contains a non-competition clause, then you've got noone to blame but yourself.

Thinking that you can sign a legally-binding contract when it suits you, and then decide that it's not "fair" when it doesn't suit you is juvenile.

At the end of the day, you're not being forced to sign the contract (and even if you were, signing a contract under duress invalidates the contract, in many jurisdictions). It's your decision to go work for the company.

I have signed an employment contracts with a non-compete clause, when I went to work for a specialist company which targeted a particular niche. The clause effectively said that, for six months, I would not be able to go work for another company which competed directly with my employers in a certain subsector.

I was fine with that, because it was all quite narrowly defined, and it made sense.

However, when I was working for an ISP which had been taken over by a telco, and they wanted me to sign an employment agreement which would have prohibited me from working from another telco/ISP for two years, I very politely told them to fuck off.

However, if I had signed that contract, and subsequently left that telco to work for another, and found myself the target of my old employers' lawyers, I would have had noone to blame but myself.

You have to take responsibility for your own actions. Read what you're signing. If you don't like it, then refuse to sign it. If they try and whitewash you, then speak to a lawyer - and get them to pay. Don't let them make you feel guilty by insinuating that you would only refuse to sign the contract if you were planning to rip them off.

There are other ways of making sure that an ex-employee doesn't clean your clocks - non-disclosure clauses, anti-recruitment clauses, and clauses which prohibit you from providing similar services to existing customers of the company.

Anyone who is stupid enough to sign a non-compete agreement which forces them to take a break from their career doesn't deserve compensation.


D.

Re:from a lawyers prospective... (2)

Samrobb (12731) | more than 13 years ago | (#391954)

It's not neccesarily as grim as PorcelainLabrador makes it sound...

The laws regarding non-competes vary from state to state. In some states, the courts are very unwilling to enforce a non-compete agreement that would effectively require someone to relocate in order to practice their trade, or which has provisions they consider overly broad (prohibiting a former bank manager from working in any capacity involving finances, for example.)

For the record, IANL; but I've consulted with a couple on non-competes I've signed while working in Pennsylvania. The above poster's comments are still entirely valid - get a lawyer to check the agreement before you sign, and don't sign any contract until you understand what it means to you and what the implications are.

Re:from a lawyers prospective... (1)

kevlar (13509) | more than 13 years ago | (#391957)

I signed a non-compete which essentially stated that I cannot work for any of my company's top 10 competitors that are published on on a list.

They have never published a list, so if it were to ever come to a legal battle, I could simply point that fact out. Besides, I highly doubt that they would enforce this if it were a senior-level engineer or manager, or someone who could seriously damage the company.

I signed the document because it specificly described what a competitor was. I felt that there were plenty of other niches where I could utilize the same skills in this industry where I would not be competing with my company.

Can't ask for too much (2)

swb (14022) | more than 13 years ago | (#391958)

A non-compete clause has two basic functions. One, it "protects" the company from its competitors (they can't hire the talent with specilized skills in the field) and from your market value, by innhibiting you from changing jobs (long time spent unemployed or working outside your field at lower wages).

A non-compete compensation package that basically paid you for the period you were not employed would satisfy part 1 but not part 2, since you would have the ability to basically quit any time you wanted and pick up a pay check until you could go to work for the competitor. They're not going to pay you to fsck around until the competition can hire you.

I'd ask for 3 weeks of pay for each year of service, and full health benefits for the entire non-compete period. This ensures that they give you something in severance to help tide you over, and gives you an incentive to not job hop often since the payout will be dependent on your long-term loyalty.

I'd also negotatiate the non-compete to be contingent only on resignation or termination for cause, and not on involuntary economic termination. Who wants to get laid off AND told they can't get a job?

If they can "require" a non-compete at all your bargaining power is probably weak to begin with. If you can negotiate something that "gives" them something without demanding a free ride from them, you're likely to get something in return.

Yeah, I signed your contract... (2)

gatkinso (15975) | more than 13 years ago | (#391961)



...yeah you caught me...

...and yes, if you so annoy me I will post all of your source code on the net AND email it to every one of your competitors.

So do you still want to make an issue of this?

Go ahead and sue for damages - but remember you won't get amymore from me than what I have. Who will be hurting more after the dust has settled?

Re:Is non-compete even legal? (2)

magic (19621) | more than 13 years ago | (#391965)

Yes, they can. They will sue you for a violation of the contract, and will probably win in many states (such as Massachusetts).

-m

My 2 pence (2)

mindstrm (20013) | more than 13 years ago | (#391966)

The majority of non-compete clauses, especially for standard IT jobs are completely unenforcable. Most jurisdictions have laws that, contract or not, nobody can prevent you from performing your trade.

In cases where your position is unique enough (read: VP or other important position) where such a clause is applicable, and in any other case, such contract should involve:

Your asking your former employer if you can take the new job you want. If it's in the same field, they can decide to not allow you to take that job. If they DO decide not to let you, and you don't want to contest it, they should have to pay you according to a fair salary to stay out of that job.

Re:Freezing IT (2)

mindstrm (20013) | more than 13 years ago | (#391967)

Right. But it sounds like your contract wasn't as simple as most of the BS ones in the IT industry that simply say 'whenever you leave here for whatever reason, you cannot work in the IT field for 2 years'.

You suspended them for three months, with prior-agreed compensation... sounds like a relatively fair contract.

Re:from a lawyers prospective... (2)

gmhowell (26755) | more than 13 years ago | (#391969)

That sounds like an invalid contract. Any contract signed under coercion is valid on its face.

Proving coercion may be tough, however...

Consultants vs. Employees (1)

DrFardook (27432) | more than 13 years ago | (#391971)

If you're a consultant and are being pimped out through a consulting firm then the no-hire contract is extremely standard.

Consultants cost a company a lot of money. Several times what they would normally pay for a regular employee so if they really like a consultant its a snap that they would want to hire them away from the consulting firm. So the no-hire policy is to keep consultant from being poached by the client. Which makes sense... otherwise the consultant stable basically becomes an expensive temp to perm service.

Now if you're an employee of a company that's quite different. You can quit and work for someone else. Its your right to practice free trade and hold employment at will. So as a former employee you have the right to practice your trade on your side. For example if I quit my current job and I had a non-complete I probably would get in trouble if I went to work for one of our major clients (because it would appear that I was paid to leave and work for them) or a direct compeditor producting the same product.

Depends. use common sense and remember that they can only forbid you from doing something pretty specific. They can't make you leave the industry.

My experience with Non-compete clauses (1)

Rellon (28691) | more than 13 years ago | (#391973)

I've been with several companies technical departments as a Network Admin. Of these companies, only the one that was into technical services required me to sign a non-compete. It was a 3-year dealie with a city-wide radius of thier offices. I was offered no compensation for this and considering some of the recent court rulings, due to the field I'm in, that 3 year contract would have been unenforcable. None of the other companies even mentioned a non-compete clause, even thought I now work in the middle of silicon valley. Most non-compete clauses are just a threat to hold over your head and I seriously doubt that most companies would strictly enforce them.

100% salary, plus insurance, 401k, bennies.... (3)

scotpurl (28825) | more than 13 years ago | (#391974)

Make sure you go for not just 100% of your salary current salary during the non-compete timeline (if you have to), but enough extra to keep your insurance current, payments into your retirement going, and everything else.

Full Pay (3)

Shotgun (30919) | more than 13 years ago | (#391977)

I was asked to sign a NDA that would have put me out of commission for 3yrs. I had been working at the company for about 9 months. My condition was that 3yrs salary at my starting rate be put in a trust fund.

I was given leave soon thereafter.

Re:Reality Check (1)

sageFool (36961) | more than 13 years ago | (#391979)

If the non-compete says something like 'thou shall not work with computers for 20 years after leaving this company' I would love it. Think of the massive salary and benifits you could negotiate with something like that. Then think of the totall unenforcability of it. It would be like you signing a contract to be my dedicated slave for life. It just would never be valid in court regardless of how much you had signed it.

Lots of noncompetes are worded poorly enough that they can't be enforced. It's all about talking to a lawyer who knows what they are doing before you sign.

Re:from a lawyers prospective... (1)

kettch (40676) | more than 13 years ago | (#391983)

could not use knowledge that he gained at the company for 2 years

What kind of idiocy is that? Does that mean that, If during his time that the company, that company paid for a person to get training to be better able to do his job. Lets say that they paid for him to learn a whole bunch of stuff about WAN administration. Does this mean that if he ever left the company, he would never be allowed to configure a router again, or he would be legally required to forget all of his knowledge when he left?

I may be getting that wrong, but it seems extremely absurd to me.
----------------------

Freedom to choose (2)

nano-second (54714) | more than 13 years ago | (#391988)

>Crossgain is a startup that aims to "create a service that runs a company's big software programs over the Web" (in competition with "we know who").

Competition? with what? MS doesn't offer a service like that... IMO it's a pretty weak charge.

>Micro$oft sued the guy ( and the other Micro$ofties ) and they had to fire themselfs from Crossgain.

No, MS threatened to sue and offered them a deal requiring them to use MS software instead of Sun and Oracle stuff. They decided the legal battle wasn't worth the time and money, but they didn't want to be forced to use MS software, so they fired themselves instead. Thus, giving them the freedom to choose their own software... pretty evil shenanigans from MS IMO.
---

Re:My 2 pence (2)

Bouncings (55215) | more than 13 years ago | (#391990)

I think that's true. Companies that put that in there because they don't think it could hurt. I don't like the suggestion of it regardless of whether it can be enforced or not. I think the idea to to just re-inforce the trade secret stuff.

So what happens when you loose? (1)

ErikZ (55491) | more than 13 years ago | (#391991)


Ok, you went to court, and got nailed by your old company. Now what?

Can they force you to quit your job? Someone said no. Do you just pay a fine? How much?

Jail?

Later,
ErikZ

Re:Good Luck (1)

daryaei (63808) | more than 13 years ago | (#391996)

I agree in that they are hard to enforce. i have signed a non-compete agreement, but i also work in a smaller town. can they come after you if you go out of state?

Not enforceable in California (1)

rossz (67331) | more than 13 years ago | (#391998)

Fortunately, here in California, non-competes are virtually unenforceable. The California court's standing is you can not be prevented from making a living in your chosen profession (trade secrets are a different matter).

In other states, sadly enough, the courts have prevented professionals from working for so long that they will become unemployable by the time the non-compete period expires.

Re:Is non-compete even legal? (1)

medcalf (68293) | more than 13 years ago | (#391999)

Not necessarily. Many companies have contracts which:

1) hold you to a broad non-compete for a long period
2) remove all of your rights to sue them, and limit their liability to any unpaid wages (in the event that the first clause is struck as not enforceable)
3) require you to pay their legal costs in any lawsuits arising out of the contract (ie, you pay them to sue you)
4) remove any time limitation on their ability to sue you

And I've seen various other horrible clauses as well. I refuse to sign any such agreements. In most cases, companies will agree to reasonable modifications.

Non-competes & horror comic books? (5)

SecGuy (75963) | more than 13 years ago | (#392003)

After following this link I came across the following amazing non-sequitor:

16603. Every person who, as a condition to a sale or consignment of
any magazine, book, or other publication requires that the purchaser
or consignee purchase or receive for sale any horror comic book, is
guilty of a misdemeanor, punishable by imprisonment in the county
jail not exceeding six months, or by fine not exceeding one thousand
dollars ($1,000), or by both.
This section is not intended to prohibit an agreement requiring a
person to purchase or accept on consignment a minimum number of
copies of a single edition or issue of a magazine or of a particular
book or other particular publication.
As used in this section "person" includes a corporation,
partnership, or other association.
As used in this section "horror comic book" means any book or
booklet in which an account of the commission or attempted commission
of the crime of arson, assault with caustic chemicals, assault with
a deadly weapon, burglary, kidnapping, mayhem, murder, rape, robbery,
theft, or voluntary manslaughter is set forth by means of a series
of five or more drawings or photographs in sequence, which are
accompanied by either narrative writing or words represented as
spoken by a pictured character, whether such narrative words appear
in balloons, captions or on or immediately adjacent to the photograph
or drawing.

A data point from quite a few years ago... (4)

shakah (78118) | more than 13 years ago | (#392004)

I was presented with one a few years ago (the company was Dendrite) that provided for a 50% salary for the life of the non-compete (2 years, I think). It was worded something like "I agree that 50% base pay during the non-compete clause adequately compensates for the hardship of the non-compete clause..." (probably to avoid a court challenge over whether the clause was fair, prevented me from making a living, etc.)

Re:Is non-compete even legal? (2)

supabeast! (84658) | more than 13 years ago | (#392005)

"I mean seriously -- can a computer consulting company (for example) force you not to work in the industry simply because you used to work for them? Or perhaps you work for a competitor that does business with the same clients?"

It depends on where you are. If you are in a right to work state (Most commonwealths are.) non-compete clauses usually will not hold up. I live/work in Virginia, when non-competes are known for being blasted away by conservative judges who will protect a person's right to work where he chooses.

In more liberal states, non-competes are often enforced by the judges there, who tend to side with the corporations.

Re:Is non-compete even legal? (1)

beme (85862) | more than 13 years ago | (#392006)

Except I've seen non-competes that specify you have to cover court costs, which can be pretty bad.

-beme

Fuck 'em. (1)

jasen666 (88727) | more than 13 years ago | (#392007)

Basically, if you're 1) dumb enough to sign a non-compete contract, and 2) crazy enough to actually abide by it, they don't have to compensate you, they've already bent you over and greased your ass.
But really... what can your EX-company do? Get a court order saying you have to quit your current job or else? Have any of you ever met someone who was forced out of a job because of a previous employers contract?

Re:Is non-compete even legal? (1)

awol (98751) | more than 13 years ago | (#392012)

Non-competing clauses are a tradition in contract law. The classic case (IIRC) invloves a car mechanic being constrained from starting up an alternative mechanic shop (or working for one) within X miles of the business that he had just sold to someone. Now the extension to this is that it applies to employment contracts, this extension has been largely accepted by many jurisdictions.

HOWEVER, there is a principle that a restraint of trade, whilst something into which someone is allowed to enter, is something that will always be construed very narrowly. There is a recognition (and it is probably still growing) that there is an emerging (if not emerged) "right" to earn a living. The kind of covenants that formed the basis for a restraint of trade clauses have their genesis in property law and there the narrow construction of these clauses reflects the reluctance of the law to "fetter" the free use of property by the property owners (oh the irony). This "right" to earn a living is a necessary concession to the changing reality that for the vast majority of persons, their only true property is their capacity to earn a living and so the emergence of a "right" to earn a living is similarly restricting the way in which anti-compete clauses are construed.

So, yes the clauses are legal (normally). But they need to be limited. Traditionally this limitation was either geographic or industry (within X miles or car mechanic vs tractor fixer) the difficulty in determining "restriction" in the context of the IT industry shows once again that the fundamentals of 18th century law must be carefully assessed in the light of the modern world lestthe unmighty get screwed.

Good Luck (5)

PDG (100516) | more than 13 years ago | (#392014)

If you can get a company to agree to that, you must have some special skill. Non compete's put you on the defense from day one at a new company and chances are the company doesn't care. Fortunately, they are extremely hard to enforce (which is what every HR person says), but at the same time, if they are so hard to enforce, why bother with them. I wrangled with my current employer for 6 months refusing to sign unless they gave me a contract or a severance package because their non-compete was so vague it included the entire industry. In the end, I had them reword the document to specifically list their 'direct' competitors, which could not change without my approval, and remove any mention of working with corporate partners.

Re:from a lawyers prospective... Tech Union? (2)

OmegaDan (101255) | more than 13 years ago | (#392015)

This is percisely the reason we (we being technology workers) need a good strong union. Tech workers could bring just about any business to its knees with a strike. Do you remember how hobbeled (sp?) verizon was during their strike? they still haven't recovered completley... At my job (sysadmin) I can't even take a day off without things going to hell ... immagine a week or month to strike.

(Anyone know of any tech unions?)

Re:Is non-compete even legal? (4)

Mordred (104619) | more than 13 years ago | (#392019)

I don't think non-compete could hold up in court...isn't it a violation of your right to the pursuit of happiness?
Non-competition clauses can and do hold up in court if your previous company decides to hold you to one.

In regards to non-competition clauses there's a very good reason for a company having them. Say you work at a real-estate company (X) handling several large corporate accounts. You decide to leave company X. Since you are the prime contact for Company's A & B, you can call them up and say "Hey, I've left X, but I'm moving to Y and would love to work with you there." Thus A&B leave X and they lose millions of dollars. Now a lot of times a company will lease restrictive clause that says "for a period of 18 months after leaving our firm you can't talk to any of your old clients". This is actually reasonable and quite fair.

Another good example of a no-compete clause was the one Ross Perot signed when EDS removed him from the board. He was given something like an $8 million severance package and told he could not compete for a period of 2 years (I think). After those two years were up, he started Perot Systems and now vies with EDS for many of the same clients.

When technology comes into play it gets a little more tricky. If you work at company X & then move to Y you can actually use knowledge of the product from company X to build a competing product at Y. This can't really be covered by normal patent protection which is why the no-compete clauses have come into play. A broad no-compete clause is ridiculous, especially one that covers the entire IT industry. One that says you can't work at a streaming media player company for 12 months after leaving is not. Courts will uphold these although I'm not sure who would get sued if you violate it. It's possible the new company would pay damages but I'm not sure.

Mordred

Whatever you can negotiate. (2)

chancycat (104884) | more than 13 years ago | (#392020)

It's all about negotiation. If you're not comfortable doing it, you won't get the compensation you may be entitled to.

Personally, I would push for 3 months at 150%-200% pay. The Tech industry moves along quickly and that kind of bump in the road can be harsh.
It all depends on your skills and industry history, for sure - but it all comes down to knowing that everything is negotiable and you are not going to get the best deal be sitting back and hoping they are nice to you. Be direct, know your base assets (to their company) and push for what you value as a comparable compensation to their non-comp. contract.

Re:Is non-compete even legal? (1)

wunderhorn1 (114559) | more than 13 years ago | (#392025)

can a computer consulting company (for example) force you not to work in the industry simply because you used to work for them?

Yes; Lawsuits are funny like that.

It's actually very simple: You sign on with Company XYZ42, get a shitload of free training and insider knowledge of their operations, then 6 months later jump ship to start your own business or join up somewhere else for a much higher salary.
Companies don't want that, so they make new hires sign co-compete contracts. You don't like that, so you negotiate a good contract, or work for someplace else.
How's that for pursuing happiness?!?

Re:Don't do it. (1)

andy@petdance.com (114827) | more than 13 years ago | (#392026)

Don't let them spring it on you once you've already burned your bridges.
For that matter, don't burn your bridges. Leaving a company need not mean that you can never go back.

I've seen too many people get their rocks off by telling their boss to piss off, only to find that their new job wasn't all it was cracked up to be.

Now, I'm certainly one of those who is very wary of going back whence you came, but it's sure nice to have the option.

--

Re:Move (2)

StevenMaurer (115071) | more than 13 years ago | (#392028)

Actually, this is one of the major reasons why liberal states do so well in the national economy. In conservative states like Texas, the law is set up to protect entrenched corporate interests. Not only is a non-compete strongly enforcable, but even things you invent on your own time with your own money is considered property of your employer. In the long run this discourages innovation - which hurts their economy far more than liberal states' high taxes.

Only enforceable under very specific circumstances (5)

nlvp (115149) | more than 13 years ago | (#392030)

I covered this during my employment law courses in the UK (what follows will therefore probably not apply elsewhere).

A non-competition clause in a contract is enforceable so long as it does not fall under the definitions of a bunch of other laws, among them the "Unfair contract terms act", and a few others more specifically dealing with employment law.

A non-competition clause must be

- Limited and reasonable in time - it cannot exceed a period that the court deems "reasonable"
- Limited and reasonable in scope - this is complex and I'll cover it below
- Fair - you can't cripple a person's future career unless the compensation is there, kind of like a waiver to the usual consideration laws - here consideration has to be both present AND sufficient, whereas usually it only has to be present.

In cases that have been tried, what usually makes the clause non-enforceable is the scope argument. The scope is a kind of function of the type of industry, the role the person had in their last company, the size and presence of that company and the number or market size of the markets in which the individual is prohibited from exercising those skills.

For example, if you were chief technology officer of a tiny development company that worked off a single product, they can't enforce a clause preventing you from working in the IT implementation industry in an entire country, because the broadness of the exclusion is far greater than the broadness of the role given up.

This rule seems to be constantly open to re-interpretation, but in almost all cases the court leans towards individual rights rather than those of the company. My guess is that this is because the companies rarely need the clause to protect themselves - if they have proprietary technology, then their copyrights and patents ought to protect them, and they shouldn't need specific individuals, and the loss of those individuals should not be a threat. Where the courts back the companies up is where the leaver takes with them a huge list of contacts that were developed using the prior employer's resources and services, or where the leaver takes with them a knowledge of the industry that is significantly ahead of it's time because the company they joined gave it to them - then an exclusion clause for that specific area will be enforced. Of course it can only be enforced for a few months because technology moves on, and it can only be enforced over very specific and narrowly-defined areas otherwise it's not considered fair.

Writing clauses like this for key personnel is very difficult and it is done for two reasons. Firstly and most usually, they are to scare people into staying. Secondly and more rarely, they are there to protect what is seen as an "excellence in thinking" in a specific area of expertise. For example, the head of technology development for Oracle probably has some clauses about working on web-enabled enterprise database delivery systems or some such junk because Oracle will have stuff in pre-patent conceptual phases of development that they want to protect, that is insufficiently defined to be awarded a patent or copyright.

Re:My 2 pence (2)

ebh (116526) | more than 13 years ago | (#392033)

Another area of unenforceability pops up when the contract is overly broad. I worked for several contract houses whose contracts said I couldn't work for "any current or potential client" for some period of time.

IANAL, but I never believed this would never hold up in court, because McDonald's could be considered a "potential" client if the contract house claimed they might "potentially" start farming out burger-flippers. Therefore the clause really said that I couldn't hold a job of any sort for that time period.

So, I signed the contracts, went about my merry way, changed jobs at will, and never heard anything from anybody. The real intent behind the clause was to a) keep me from being hired by the client I worked for, and b) keep me from changing contract houses while working for the same client.

Sidebar: Eventually I was hired by a client, because the client's contract with the consulting firm had a buyout clause in it. Regardless of what your contract says, make sure you know what's in the client's contract! It can often work to your advantage.

Let us remember other fun parts of the contracts (2)

bons (119581) | more than 13 years ago | (#392035)

Here's my favorite:

"All inventions which I conceive or develop during my employment, whether alone or jointly with others ans whether during my working hours or otherwise, whic relates to the business or interests of Company or any business or other company in which Company has an interest sall be Company's exclusive property".

On the other hand, I worked for SAC/STRATCOM. Their policy was much simpler: "If you plan on leaving the country in the next five years or you meet someone you find out is from any foriegn country, let us know. We'll want to interview you."

-----

For folks in Mass./Boston (1)

gmag3 (121600) | more than 13 years ago | (#392036)

Remember, a non-compete is a contract, and like all contracts it requires consideration. A promised pay raise in exchange for signing the non-compete may not be sufficient consideration if it the raise is really given based on performance. Similarly, a promise of continued employment may be insufficient consideration if the non-compete is presented as a "take-it-or-leave-it" matter, rather than negotiated by the parties.

Move (2)

Animats (122034) | more than 13 years ago | (#392037)

In California non-compete agreements are generally not enforceable at all. This may be one of the reasons Silicon Valley is so successful; there's no bar to leaving to start up your own company.

Re:Good Luck (1)

pallex (126468) | more than 13 years ago | (#392039)

"but at the same time, if they are so hard to enforce, why bother with them"

They probably are too cheap to go to a lawyer with it! if they did, they`d probably find it was legally worthless. Be warned, they may take the same half-assed attitude towards their customers.

Re:Don't do it. (4)

RalphSlate (128202) | more than 13 years ago | (#392040)

Problem is, you need to specifically ask for the non-compete before accepting the job (and leaving your previous job).

In the past, I've been made an offer from a company and accepted. Then on my first day they hand me this form to sign, and if I don't sign it they will let me go. At that point my options are limited.

I've also been in a situation where my company came up with a new non-compete and said "we're not holding a gun to your head, but if you don't sign this we won't be employing you anymore.". Again, not much choice.

The only defense is, upon receiving an offer, to ask for a copy of the employment agreement. Then use that to negotiate or base your decision to work. Don't let them spring it on you once you've already burned your bridges.

Ralph

My idea of fair compensation... (2)

JiveDonut (135491) | more than 13 years ago | (#392043)

Work for a competitor anyway. Tell your old employer to screw off.

Oh yeah, IANAL, so use this advice at your own peril.

Non-compete = still employed by them (1)

ArticulateArne (139558) | more than 13 years ago | (#392044)

As long as a company is restricting your employment, you are still effectively under their control. Therefore, it seems reasonable that if they can restrict what you do with your day, they should pay you for your time.

If they're still paying you, you can sit at home and do whatever you want with your time, I guess as long as your not making money off it or helping anybody else make money. This sounds to me like a good time to contribute to some open source projects, do some good to the community, keep your skills up, and get paid at the same time!

What's the core (2)

Aceticon (140883) | more than 13 years ago | (#392045)

This is a story of an executive that left Micro$oft in June saying he needed a break from work.

He joined Crossgain (a startup) in September because "he saw it as a key player in the next generation of Internet computing"

He's contract with Micro$oft contained noncompete restrictions valid for 1 year.

Crossgain is a startup that aims to "create a service that runs a company's big software programs over the Web" (in competition with "we know who").

Besides him also a couple of ex-Micro$ofties went to Crossgain.

Micro$oft sued the guy ( and the other Micro$ofties ) and they had to fire themselfs from Crossgain.

He and a couple of his collegues tried to pull a fast one and failed - so what!!!

Disclaimer: Even though this involves Micro$oft, which is the devil incarnated, i am refraining myself from being parcial against MS.

Re:Can't ask for too much (1)

Com2Kid (142006) | more than 13 years ago | (#392046)

Intresting point about long term loyalty. I think that if I company doesn't manage it's employee's into the ground with long drawn out overly restrictive contracts, then they will not have a very large problem with job jumpers. Face it, if a company is nice to you and gives you alot of freedom, and who's only demand is that you make a profit for the company by doing your job and doing it well, then the odds are that you are going to remain loyal to the company! On the other hand, if from the get-go the company makes it clear that you are nothing more then a paid drone (with items such as non-compete clauses) then the odds are that you are not going to give a shit about the company either.

Is non-compete even legal? (2)

don_carnage (145494) | more than 13 years ago | (#392048)

I mean seriously -- can a computer consulting company (for example) force you not to work in the industry simply because you used to work for them? Or perhaps you work for a competitor that does business with the same clients?

I don't think non-compete could hold up in court...isn't it a violation of your right to the pursuit of happiness?


--

Re:Is non-compete even legal? (2)

don_carnage (145494) | more than 13 years ago | (#392049)

Ah...so it all comes down to: how much money do they want to spend taking you to court. 8^)
--

Re:Don't do it. (1)

kevin42 (161303) | more than 13 years ago | (#392051)

The only defense is, upon receiving an offer, to ask for a copy of the employment agreement. Then use that to negotiate or base your decision to work. Don't let them spring it on you once you've already burned your bridges.

Absolutley!

I've always asked to see whatever contracts they want me to sign as well as the entire employee manual before I accept a job. I'm surprised how few people must ask for this because the HR departments always act like I'm from the moon or something -- but they always cooperate.

At this point you can negotiate changes in the contract & stuff if you need to.

As far as an existing employer trying to push a new contract on me -- I'd be gone before they knew what hit them. We're in too much demand to be treated like that!

Don't agree to a blanket non-compete (2)

kevin42 (161303) | more than 13 years ago | (#392052)

There is no reason anyone in this industry (computer software/hardware) should have to agree to a blanket non-compete to get a good job.

The only compensation that would be worth signing for would be if you were going to get paid over 100% of your salary for the entire length of the time you couldn't compete.

In this industry we are often asked to sign confidentiality agreements, which are entirely different. We simply cannot divulge another companies secrets. That makes sense. But agreeing to not compete in the computer industry is ridiculous. Usually it's common in other industries because they are customer oriented (ie. most banks and insurance companies offer pretty much the same services, it's mainly a game of getting the customer base) and they don't want one person walking away with the customer base because they know the customers well.

So let's do ourselves a big collective favor and refuse to sign any non-compete agreements!

Been there. (1)

alarmo (168648) | more than 13 years ago | (#392055)

At a recent job (I won't name the company), I asked on the way in about the agreement. They didn't have one at the time, fine. Two months later, they come in with a heavy-duty con-compete contract (with no compensation provisions in it, either!) and told us "sign it or you're fired".

I walked. There are enough companies looking for programmers that I didn't even lose sleep over it. I wasn't the only one, either. Eventually, maybe corporate bosses will get a Clue(tm) that doing that serves precisely to drive out the people they're trying to keep....

Depends on the state law (1)

alarmo (168648) | more than 13 years ago | (#392056)

As someone posted above, it depends on the laws of the state you're working in whether or not it's legal (some states, like Texas, are "employment at-will" - translation, no reason is ever required by law for letting someone go). In practice, it may be somewhat shaky legal ground, but your safest bet (and surest way to stay out of court, whether or not you'd win) is just to find another job. It's also less stressful; if that's management's clue level, do you really *want* to see what they do next?

Who needs salary history? (1)

alarmo (168648) | more than 13 years ago | (#392057)

Interestingly, I never provide salary history, and it's never stopped me from getting hired yet. Out of politeness, if asked about it, I'll give a range ("mid-whatevers" or "low-whatever") from wherever I previously worked, but since I switch between contract and permanent work anyway, it's just not always relevant.

And yes, for reference, I'm in my 20s too. Sure there are plenty of inflexible, our-way-or-else employers out there - but there are also more clueful shops too. Keep looking....

Re:Is non-compete even legal? (1)

FortKnox (169099) | more than 13 years ago | (#392058)

For a consulting firm, as an example. You sign an agreement that states that you cannot work for a company you are consulting for unless your firm allows it. You signed a contract. You go to work for them, you get sued for breach of contract. They can't force you to not work there, but they can sue the pants off you, if you do.

--

Re:Is non-compete even legal? (1)

taustin (171655) | more than 13 years ago | (#392060)

Non-competes are not, by and large, enforceable. There is a fair amount of case law on the subject. NDAs concerning trade secrets can be legal, if they're done just right.

Which won't keep it from interfering from you getting another job, because the only way to prove it's not enforceable is in court.

Try this link [emergit.com] for a decent overview.

Compensation for Non-Compete -- Intriguing! (1)

mikehoskins (177074) | more than 13 years ago | (#392065)

Compensation for Non-Compete -- Intriguing!

Hmmmm.

Contract (1)

Archangel Michael (180766) | more than 13 years ago | (#392067)

Why would anyone take a job without a contract in this day and age? It is insane. I would not quit my current job unless I have a written contract and a signing bonus to boot, even if it was a much higher paying job. The risks are too great.

If a NC clause was not in the contract, then they cannot void the contract just because you don't sign the NC that is secondary to the original contract. And if they do decide to let you go, you have a signed contract (hopefully with a great escape clause) that they have to honor.

Companies are out to screw you, you just have to be smarter than they are.

Abuse of the system (5)

Alien54 (180860) | more than 13 years ago | (#392069)

Ths Section from the story is fascinating. It shows how MS not only uses Non-ompete clauses to stop people from leaving, but how they use it to enforce their monoply.

my reaction is not printable in a family oriented medium.

There's a saying in techdom about Microsoft: Don't moon the giant. Crossgain mooned Microsoft every which way. First, the ex-Microsofties poached some of their former colleagues to join them at the startup. Then they raised $10 million from investors, including The Barksdale Group, a venture firm run by Microsoft's chief nemesis at the antitrust trial, former Netscape Communications Corp. (AOL) CEO James Barksdale. A few months later, Crossgain named Mitchell Kertzman, an outspoken critic of Microsoft's business practices, a director. Kertzman is CEO of Liberate Technologies (LBRT), an interactive-TV software maker that competes fiercely with Microsoft interactive-TV technology

The last straw was Crossgain's decision to base its technology on non-Microsoft software. Instead of using such Microsoft products as the Windows 2000 operating system and SQL Server 2000 database package to develop its service, Crossgain opted for software made by rivals. ''It doesn't look very good for Microsoft if a company run by its former vice-president of developer relations is using software made by Oracle,'' says a former Microsoft executive.

With a potential lawsuit looming, Microsoft offered a deal, according to Crossgain and Microsoft. If Crossgain committed to building its service with Microsoft products, the company wouldn't pursue the noncompete claims. Crossgain sources say Microsoft specifically wanted to preclude the company from using Oracle database software. Microsoft sources deny that. Switching to Microsoft technologies meant huge delays and the loss of months of work for Crossgain, which hopes to launch its first service in March. But the deal also meant avoiding months, or perhaps years, of litigation with one of the wealthiest companies in the world. Crossgain execs thought they could win the litigation, but the time and expense to do it would be a huge drain.

The system is obviously open to abuse, and I am going to have to think long and hard on how best to sort this out.

Out of sight, out of mind... (5)

FyreGryffon (182789) | more than 13 years ago | (#392070)

When I showed up for my first day at one company, I was presented with a non-compete/intellectual property agreement. I was told that my employment was conditional on my acceptance of the terms of the document and my signature. I never signed the document, but I continued to work there for months.

How did I accomplish this remarkable feat? I reasoned thus: Essentially all non-compete agreements are worded in ways that are grossly unfair to the employee. Accepting the agreement a company puts under your nose as written is roughly equivalent to accepting the first price quoted to you by a street merchant in a middle-east bazaar.

Further, I reasoned, lawyers are like ferrets; they have short attention spans and more teeth than is strictly necessary. So I refused the agreement based upon a few clauses I found objectionable (it's not hard to find something to bitch about in one of these documents). The company sent the thing to their lawyer to have him review it in light of the objections I had made. He made some changes. I found more things to whinge about in the new document. I sent it back.

We played this game for about two weeks until (as ferrets will) he wandered off and found a new toy to chew on.

Problem solved.
--

Re:Is non-compete even legal? (2)

Erasmus Darwin (183180) | more than 13 years ago | (#392071)

I don't think non-compete could hold up in court...isn't it a violation of your right to the pursuit of happiness?

Overly broad non-compete agreements have been struck down. Those with sufficient limitations (generally time and/or area) on what they affect have been upheld. "Pursuit of happiness" has nothing to do with either case or American law in general, given that that's a phrase taken from a declaration of war, not our Constitution.

...but in reality (1)

Ratteau (183242) | more than 13 years ago | (#392072)


I am not a lawyer, but know of many non-compete disputes which have arisin over the years involving my company in one way or another (electronic components distribution industry, but none recently). There are a couple things that will almost guarantee an NC not hold up in court, and the example above is a perfect case of one of them. If you are compelled to sign under penalty of job loss or compensation loss, it will probably not stand. If the individual in the story had to sign when he was hired, that is one thing. The fact that he had been there for a story and was threatened with termination year is a completely different story, and something that usually results in the judge throwing out the NC. If you do leave and go somewhere else and his old company files a charge, the new one definately has a case to get it overturned.

The other case is that the NC unfairly prevents the signor to earn a fair living. For example, if you go to school to be an EE, become one and work as one, you are going to gain practical knowledge that you would use if you ever left the job. Barring someone for 2 years from using this knowledge and basically from working as an EE, will get the NC negated in court. Its not like you can just get another job with the comperable compensation. You cannot be barred from earning a living if you have a specialized skill.

Again, I am not a lawyer, but I know first-hand cases that have been thrown out on both counts (Im sorry for those of you who demand specific case evidence, but for confidentiality reasons, neither names nor companies will be named). However, the original poster gave the best advice on how to handle the situation, have a lawyer check over anything like that that you are asked to sign. Whatever you do, do not let them force you into doing something "by the end of the day" -- if you werent important enough, they wouldnt ask you to sign one in the first place, so they will probably let you have a day or two to get advise. If not, take what you know and go somewhere else.

If you feel you were unfairly compelled to sign, dont worry, there are avenues you can take.

Re:Don't do it. (1)

t3mpest (187959) | more than 13 years ago | (#392074)

I agree. I don't sign non-competes. It's that simple

Re:Is non-compete even legal? (2)

ichimunki (194887) | more than 13 years ago | (#392076)

If they win, it will be more likely a matter of how much of their legal bills are you willing to pay. It seems to me that the American Sheeple and the Wolves that protect the flocks are all too willing to savage one another in these types of disputes. I wouldn't put it past any employer who thinks a non-compete clause is a good idea in the first place to make sure that it ruins you, even if it doesn't do them one lick of good.

If they force you to sign... (1)

billcopc (196330) | more than 13 years ago | (#392077)

Threaten to move 'zig'. But seriously, do apply for work elsewhere, but under a pseudonym.

-"Aren't you Larry Ellison of ex-Oracle fame ?"

-"Ahem *cough* of course not. I'm Gary Ellison, and I'm better than that Oracle guy."

Heck.. it's so friggin' stupid it might be worth a try :)

No Compete Not Legal in Some States (3)

zentec (204030) | more than 13 years ago | (#392079)

Back when I worked in broadcasting, the industry thought they could get away with no-competes for everything. Right down to the minimum-wage people they had answering phones. As my attorney told me, if you live in a right-to-work state, the only way a no-compete clause is valid is if there's quid pro quo. That is, they buy from you the work time that you'd spend at another employer. If they chose to let you spend that time watching Jerry Springer or flipping burgers, that's up to them. But they have to *purchase* that ability. Generally, I've seen negotiated rates from 100% of salary to what I negotiated in my no-compete which was they make up the difference if my non-broadcasting job was paying less than what I was making in the industry. So, when the company was bought out, I found myself a posh job in the bookstore at a community college. I was paid a paltry sum of $9 an hour for 5 hours per day and due to (the all to common) ineptitude of the broadcast outfit, they made up the difference for my old 8 hour-day job. Best two years I've ever spent!

Depends on how good you are (1)

Agelmar (205181) | more than 13 years ago | (#392080)

I think that it really depends on your skill level, and what you've done for the company. If you have developed a major part of a company's product, then certainly you are far more valuable to the company, and to others, and therefore should be getting at least 200% if they're not letting you work for another company for X months. OTOH, if you are just a peon, then they might as well let you go, and you're lucky to get 100% if they are even holding you back from working at another company. I think that each case needs to be handled on an individual basis, and that we cannot just slap a sticker on all of the contracts that say "X% for Y months" My $.02

Re:Good Luck (2)

AlphaOne (209575) | more than 13 years ago | (#392081)

Fortunately, they are extremely hard to enforce (which is what every HR person says), but at the same time, if they are so hard to enforce, why bother with them.

If someone can easily kick your front door down, why bother with locking it at all? It's simply a deterrent more than a strictly enforcable contract.

--

Worst Non-Compete in the world: The US Army (5)

tenzig_112 (213387) | more than 13 years ago | (#392083)

When I joined the Army, they told me right off the bat that I couldn't go off and join another country's army without getting arrested for "treason." And get this, I could even get sent to the electric chair.

And I can't even leave the Army whenever I choose. They said that if I was "absent without leave," the MP's might shoot me on sight.

From all the books I've read about getting ahead in your job, it seems the best way to advance is to hop from job to job every five years. Now, how am I supposed to do that? Private Phil McCrakkin [ridiculopathy.com]

Falls in line (1)

vinnythenose (214595) | more than 13 years ago | (#392084)

This falls in line with how companies want to know of everything you ever invented and they want what you invent while you work with them. Pure corporate crap. I wouldn't mind signing a clause that said that I can't use materials designed at work, elsewhere but for work, or that I may be prosecuted if I use proprietary information from one company at another (both of these are hard to enforce as well). But if I leave a company, I should be allowed to go wherever I want. If I develope something at home with no help from materials from work, it's mine, not the company's.

But I never said me and my views were perfect.

Signing Contracts = Money (2)

Fatal0E (230910) | more than 13 years ago | (#392085)

or some other method of compensation but that's an aside. The fact remains that if I am bound by a contract I expect to be compensated for it in some way/shape/form. Why shouldn't it extend to an NDA, especially if a No-Compete clause is thrown in. Anytime my obligations are dictated by something I was asked to sign I had better be able to realize a gain of some sort. A contract that benefits only one side is a raw deal.


"Me Ted"

Re:Don't agree to a blanket non-compete (1)

billybob2001 (234675) | more than 13 years ago | (#392086)

You don't need to sign stuff to agree to it.

It's true. Apparently (and IANAL) the fact that you continue to work for an employer (and happily take the pay they give you) can be construed to mean that you agree with any terms and conditions they wish to enforce.

Of course, you must not forget that the law is an ass.

Ignore them. (1)

NineNine (235196) | more than 13 years ago | (#392087)

I've been a contractor for years, and I just ignore them. Just don't tell your company where you're going to work next when you leave. It's very simple. They know nothing, so there's nothing to worry about.

Re:Fuck 'em. (1)

epicurus (252619) | more than 13 years ago | (#392098)

yeah, that's THIS artical...

Re:Fuck 'em. (1)

kilgore_47 (262118) | more than 13 years ago | (#392103)

i believe some startup got sued because a large portion of their staff used to work at microsoft and had signed non-compete agreements. They had to lay off a third of their staff, or fight M$ in court. It was on slashdot a while back. So, yes. People are forced out of jobs

Re:Depends on how good you are (1)

kilgore_47 (262118) | more than 13 years ago | (#392104)

Also, it should only if you are trying to work in the same industry. Microsoft is trying to blanket theirs i guess, because they work in so many parts of the hitech industry, but most companies don't compete with all or even most your potential future employers.

Noncompete thoughts (1)

merlin_jim (302773) | more than 13 years ago | (#392107)

I'd be happy with my normal pay for 3 or 6 months or whatever it is. As long as I can do work during that time period for myself.

Basically, this would give me time to prepare a resume and work on private work and brush up my skills. If someone is paying you not to work, that doesn't mean you can't keep your skills sharp! And most companies give you a package if you're fired, so this is a perfect opportunity.

The only condition is that my IP becomes my own. A surprising number of companies own your KNOWLEDGE while you work for them; if you patent anything or write some really cool software outside of work, then that information belongs to them, not you. That's the real problem. I mean, if I go home tonight and write the "Killer App", there's nothing I can do legally (short of lying) to keep my company from claiming all rights to it.

But, if the my IP becomes my own immediately on termination, and I'm paid at least 100% of my salary for the length of the NC contract, then I'm a happy /.er

Re:from a lawyers prospective... (1)

cavemanf16 (303184) | more than 13 years ago | (#392109)

Yes, non-compete agreements can restrict a person, but usually they're geared towards keeping copyrights and business practices in-house. You can still take your skills and use them in the same type of job elsewhere. Companies just don't want you taking your programming knowledge of their in-house software to another company, but I doubt they would have a problem with you going elsewhere to program on a different companies' software. (Just don't give the other company advice on how to duplicate the design of your previous companies software).

Re:from a lawyers prospective... Tech Union? (1)

Bobo the Space Chimp (304349) | more than 13 years ago | (#392110)

You will never get a union of programmers. We programmers have big egos, and unions drag the superior down to the mediocre median. Since we're all above the median for programmers, no one wants or needs a union.

I also find that it would be despicable to tell a corporation that they couldn't hire permanent replacements for me.

Re:Can't ask for too much (1)

Bobo the Space Chimp (304349) | more than 13 years ago | (#392111)

A 100% salary over a year period to keep you from competing, well, I'd like to see any company do that.

Let's see, I could either work for 100% salary over the next year, or take a year off at 100% salary, then go to work somewhere else.

Turnabout (5)

blair1q (305137) | more than 13 years ago | (#392113)

Try this:

Next time they try to get you to sign a non-compete clause, whip out one of your own for them to sign that says they will not hire anyone who does what you do for 12 months after you leave...

--Blair

Marriage is a contract... (1)

gus goose (306978) | more than 13 years ago | (#392114)

In many countries, marriage is a contract... picture it, a non-compete clause. Even better, a no-moonlighting clause. It is not something which I would agree to under any circumstances, unless it provided me with a better income while I was NOT working ... then I would considder the deal, jeez, who wouldn't. Basically, I can be bought.

gus

Don't do it. (2)

ipsurge (316032) | more than 13 years ago | (#392118)

Don't sell your soul for a job. If a company wants to hire you bad enough, they'll waive the contract. If not, move on. It's not worth the headache you'll acquire if you leave the company.

Re:Noncompete thoughts (1)

cats (316481) | more than 13 years ago | (#392119)

Hmmm....

If you write a "killer app" at home, on your own time, with your own equipment and the knowledge required to create such a product has nothing to do with your companies business, i.e.-You write a wonder-widget for sound systems and you work for a financial institution. They do NOT own your invention. Will you have to fight it in court? Yes. Will you win? Well, how much money will you invest in a Johnny Cochran or Lee Bailey?

As if! (1)

slcdb (317433) | more than 13 years ago | (#392121)

As if Microsoft is the only company that plays "hardball".

As if there's something wrong with playing "hardball".

As if anti-trust laws have anything to do with "hardball" tactics.

The author of the article obviously has already been indoctrinated into the anti-Microsoft dogma. He complains too much about Microsoft's "hardball" tactics and not enough about the *real* issue, which is these goddamn non-compete clauses.

I think it's these clauses (which seem pretty standard amongst software companies) that are a violation of anti-trust law because they actually do artificially hamper competition.

Re:Signing Contracts = Money (1)

CdnZero (318885) | more than 13 years ago | (#392122)

This is exactly the point. In Canada, a contract that does not benefit both parties involved is unenforceable. The first thing a court would ask is what benefit was offered to each party. My company got around that by paying me $1.00 (minimum cash amount required to make a contract legal) which was fine by me since the agreement only required that I not swipe any of their current clients. The upshot is, if the company doesn't offer you some form of compensation for signing an NDA they haven't got a leg to stand on (at least in Canada... eh!)

Re:Don't do it. (1)

jpetzold (319053) | more than 13 years ago | (#392123)

yeah well wait ten years. by then the computer field will be as saturated as the engineering feild is and the teaching field was. then we will need a strong union because we will get fired at the drop of a hat.

Re: from a lawyers prospective... (1)

PorcelainLabrador (321065) | more than 13 years ago | (#392125)

Certainly, the power of the non-compete waiver is in the 'vagueness' of the document. In the case of legal action against the signer, this leeway allows the law (or possibly a arbitrator) to interpret whether or not the signer was within the bounds of legality.

Of course, a judge will probably not uphold action against a developer for re-using his VB skills at another house, but if he were to use 'specific' or 'trade-secret' knowledge obtained at his previous employer, he may be in jeopardy.

Finally, remember that all of this is at the discretion of the company making you sign on the line. They only wish to protect themselves against their competitors, but does not mean that they would go after an engineer who knows how to use Word.



from a lawyers prospective... (5)

PorcelainLabrador (321065) | more than 13 years ago | (#392126)


This is a very important issue that many technology professionals get caught up in. Kids out of college are most harmed by a non-compete waiver that most companies will impose (at their discretion).

People should be very aware that these contracts are indeed legal, and binding. They will hold up in court and I've seen it happen.

One story I have is of a guy who had been working at a tech firm for a year when a VP invited him into his office. The VP passed a document over the desk, casually, and said that he would need it returned within a day. Of course, the document was a non-compete waiver that the company was instigating. In it was provisioned that this man, should he leave his current job, could not compete directly/indirectly with his current company, and could not use knowledge that he gained at the company for 2 years. He was told, that if he did not sign the waiver, he would be fired. The sad thing is that this is perfectly legal for a company to do. It's very important for people to ask about non-competes when they first jump into a job, because it may turn up and bite them in the arse at any time.

Also, I have strong advice for young techies to be careful about signing these things. You could very easily be locked into your job permanently.

Better advice, is to find a friend or relative that is a lawyer and have them take a look at any waivers before you sign on the line.

I believe in fair contracts. (1)

Lover's Arrival, Thy (321389) | more than 13 years ago | (#392127)

The only contract is one that does not violate the rights of the individual. Any contract that tries to take away your freedom is null and void.

My ex boyfriend once signed a non-competition contract for a company he worked for one summer during college. After he left their employment, he was forced to speak without the use of the letter "g" because of the work he did for them. It took a great deal of effort by his laywers to refute the clause in court, but he did eventually win.

It only goes to show that contracts can be used for great evil, and we must do out part to see that evil is not spread. This is one of the reason why I would not submit to exclusive fucking rights with my ex boyfriend, and now he has left me because he did not feel the same way as I. As a whore and a slut, I refuse to disregard my rights to fuck anything and everything I can, so long as it fits between my legs!


You fuck me because you like to fuck

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