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Non-Competes As the DRM of Human Capital

kdawson posted more than 6 years ago | from the free-flow-of-people-and-ideas dept.

Businesses 193

An anonymous reader writes "Techdirt has an interesting look at how non-compete agreements are like DRM for people, doing just as much damage to innovation as DRM has done to the entertainment industry. It includes links to a lot of research to back up the premise, including some studies showing that Silicon Valley's success as compared to Boston's can be traced in part to the fact that California does not enforce non-compete agreements."

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DRM (-1, Troll)

Anonymous Coward | more than 6 years ago | (#21596949)

Human capital? Not really a valid comparison [google.com] .

Warning: Unsafe redirect (3, Informative)

sethstorm (512897) | more than 6 years ago | (#21596997)

Link leads to shock site.

Re:Warning: Unsafe redirect (5, Funny)

Red Flayer (890720) | more than 6 years ago | (#21597301)

That reminds me of the note I have taped to my monitor:

Warning: Do not look into goatse with remaining eye.

Why not.. (0)

Anonymous Coward | more than 6 years ago | (#21596977)

Companies teach you what they need for you to work for them and stop you from innovating so you can't compete with them.

Re:Why not.. (2, Funny)

daninspokane (1198749) | more than 6 years ago | (#21597101)

The company I work for made me sign an agreement before I was hired. Anything I do or create belongs to them while I am at work or even if I create something that deals with my industry on my own time, it's theirs. This post...yea... belongs to them.

Re:Why not.. (2, Funny)

ByOhTek (1181381) | more than 6 years ago | (#21597269)

Apparantly my employer requires everything I make (software-wise) for them be public domain. I'm not sure if it covers my off hours as well. I like my employer better.

Re:Why not.. (0)

Anonymous Coward | more than 6 years ago | (#21597579)

My employer has been considering making our software public-domain. But I believe that's in reaction to the possible threat that the company gets taken over.

I sure would love to use our software on personal/side projects.

Re:Why not.. (5, Insightful)

Svartalf (2997) | more than 6 years ago | (#21597437)

And I'm in the process of trying to negotiate that BS line away in an employment
agreement I got presented.

There is no way I will sign an agreement of that nature without serious modifications.
I've walked away from contract gigs in recent times where the client's HR outsource
insisted that I couldn't start work without signing the document and that there would
be no modifications to the document (Effectively dismissing me before I even started-
the hiring manager went into a panic and went charging around to get permission to
get me to submit an amendment to the agreement that protected their interests, but
by that point in time, I'd already got another comparable contract and was off the
hook from the other. Don't play games with me. You wouldn't tolerate this stuff
out of me, I won't tolerate it out of you as an employer.

In the end, it's standard boilerplate and it's from businesses or their lawyers
thinking they're "clever" and trying to avoid losing anything that might be theirs.
The problem is, for me, it IS indentured servitude- and they're in no way even remotely
paying me enough to lay claim to everything I might come up with, nor could they.
The HR people all invariably say "that's not what we're intending"- BULLSHIT. If you
intended otherwise, you would have put it in the agreement- what is on the paper is
what you intended. If it's not, you need to fire your damn Counsel and find one that
will do what you actually intend.

Re:Why not.. (1)

Mr Pippin (659094) | more than 6 years ago | (#21597497)

Yeah, that's about as bad as "Intellectual Pre-Assignment" clauses, too.

Re:Why not.. (1)

0x15e (961860) | more than 6 years ago | (#21598113)

The HR people all invariably say "that's not what we're intending"- BULLSHIT.

Exactly. I went back and forth with my current employer for a month over my employment agreement trying to get the noncompete and IP clauses tweaked. The fact was that he didn't even know what was in it or what those clauses meant. The lawyer had pretty much churned out the whole thing and I had to go through it and rewrite / tweak the parts I disagreed with. The whole time, I had to explain to my (soon to be) employer what everything meant and why I wouldn't agree to have everything I do be owned by the company and agree not to work again in the region for years after I was done with the job. After several revisions, it finally got where everyone was happy.

You really have to pay attention to what you're signing and have a decent idea of what it all means. As my situation shows, even if your employer has the best of intentions, it may be a bad agreement. You have to take responsibility for looking out for your own best interests.

Re:Why not.. (0)

Anonymous Coward | more than 6 years ago | (#21597487)

My company wants me to sign such a contract that says *anything* I come up with software or otherwise is owned by them (the IP) by default.

So if I come up with a new banging nails into wood widget they own that unless I get prior approval, which I feel is a tad unfair to say the least! :(

PS: I am in the UK.

Re:Why not.. (2, Insightful)

Bert64 (520050) | more than 6 years ago | (#21597801)

That is indeed unfair, but it will be quite happily accepted by people that:
a, never intend to produce anything, just coast along doing their 9-5
b, don't read what they sign

I have refused to sign several such contracts, some companies will be flexible about it but some won't... At the very least, you can get the clause narrowed in scope so that it:
a, only includes inventions which relate to the company business or the business your employed for
b, only count things done on company time (ie things your boss told you to look into, not stuff you came up with on your own)

Re:Why not.. (0)

Anonymous Coward | more than 6 years ago | (#21598025)

It's restrictive and when I asked if it could be changed to:

During "at work" or utilising any of the company resources, IP, trade secrets or whatever it is owned by them. Anything else is owned by me. The answer was "No".

If I want to work in my own time on a open source project or just help a friend out, I have to get prior approval for anything and everything (even if its not software, E.g a science fiction book)

Their retort was that people doing other working outside their contracted hours can use it as an "exit strategy". Well I think been forced to sign a contract like that is a good way for making people look for an "exit strategy" :)

Plus from what I gather discussing an idea with some other party weakens your patient position, never mind the fact the company goes, "oh ta very much, we'll that" and you don't have a great deal to fight back with!

Bah

Re:Why not.. (1)

Bert64 (520050) | more than 6 years ago | (#21599341)

I've rejected several job offers based on contract terms like that, if people keep doing it they will eventually have to change their terms.

Such terms can often decrease the talent pool too, people who are more in demand can be more choosy about their contract terms resulting in companies with such terms only being able to employee lower quality staff: (those in less demand, those who have no intention to invent anything and thus don't care, those who are too careless to read the contract etc)

Re:Why not.. (5, Interesting)

bhmit1 (2270) | more than 6 years ago | (#21597983)

I'm an independent consultant, so our equivalent is the "work-for-hire" clause which says everything I do belongs to them. I typically start the statement of work off on my paper/template that says the following:

Client appreciates the value of reusing works created by Consultant at previous engagements and understands the need for the Company to reuse non-confidential portions of works created during this engagement with future clients. Any work, including but not limited to, patentable works; designs; drawings; specifications; models; software; source codes; and object codes, created by Consultant during this engagement shall be provided with a non-exclusive, perpetual, worldwide, royalty-free license, with no rights to sublicense, to use in the context of this engagement to the Client at no additional cost to the Client.
Translation: they get the knowledge I developed at other customers if other customers get the benefit of knowledge I developed with them. When HR/legal tries to change the agreement, I start off by saying these are the terms I use when dealing with IP. If they push harder, I tell them that I'm willing to use their terms, but:
  • My rate will increase because I can't use this work elsewhere and could potentially be working at another client where my work could be reused and make me more valuable.
  • My time estimates will at least double since I have to recreate everything I've done elsewhere that I had previously planned on using for this project
When companies realize they get a benefit from not using non-competes, they quickly change their mind, and so far, not one has forced their version of the IP agreement on me.

Don't feed the competiton (1, Insightful)

cthulu_mt (1124113) | more than 6 years ago | (#21597017)

My contract prohibits me from engaging in the same business as my current employer for up to 5 years after termination. It makes perfect sense though; why fill my head with Trade secrets and methods just to have me open up shop across the street.
Hell, that's how my boss got started. His employer didn't have a non-compete clause and he proceeded to run them out of business.
Competition is the core of good Capitalism but nothing says you have to help your enemies.

Re:Don't feed the competiton (3, Insightful)

snaildarter (1143695) | more than 6 years ago | (#21597165)

You're right; non-competes reduce competition. You're wrong about "nothing says you have to help your enemies," as we have numerous laws that say exactly that, like the CLEC system with telephone companies.

The issue of trade secrets is a separate one from the issue of non-competes. Trade secret laws could still be enforced without the need for non-competes. Again, like the article says, look at the Silicon Valley vs. Boston thing.

Re:Don't feed the competiton (1)

tepples (727027) | more than 6 years ago | (#21597829)

Trade secret laws could still be enforced without the need for non-competes.
But given the inevitable disclosure doctrine (use Google if you're not familiar), a lot of states apply a non-compete interpretation to non-disclosure agreements.

Re:Don't feed the competiton (4, Insightful)

4iedBandit (133211) | more than 6 years ago | (#21597169)

My contract prohibits me from engaging in the same business as my current employer for up to 5 years after termination.

So you can't use your expertise to make a living for 5 years? Or does you contract have your employer paying you severance for 5 years? I'm betting it doesn't. I'm also betting that your employer is happy with the knowledge that he doesn't have to pay you market, or give you decent benefits because if you leave you can't compete with him for 5 years. It's just another form of indentured servitude and you're a willing participant.

Competition is the core of good Capitalism and you agreed not to. Oh yes that's great for your employer, no doubt about that.

Re:Don't feed the competiton (0)

Anonymous Coward | more than 6 years ago | (#21597499)

I work for Caterpillar. Such a contact would prevent me from going to work for Cummins or Detroit Diesel. It won't prevent me from going to work for any of the other 1000 companies that hire Mechanical Engineers. It prevents me from working on a project for years and learning about The Next Best Thing and then running to the competition.

Re:Don't feed the competiton (4, Insightful)

4iedBandit (133211) | more than 6 years ago | (#21597673)

It prevents me from working on a project for years and learning about The Next Best Thing and then running to the competition.

I don't normally pay attention to anonymous cowards, but in this case it deserves a response.

What this contract really prevents is your employer keeping you happy and on the job. Does your contract guarantee your benefit plan? Your retirement plan? Cost of living minimum yearly raises? Severance should you be released?

A fair contract is one that benefits both parties. A non-compete only benefits the employee if they get something in return for the duration of the non-compete. If the contract only protects the companies interests then your interests are being thrown out the door. Don't accept their word that they will "do the right thing." If it's not in writing they don't have to and most likely won't.

Re:Don't feed the competiton (1)

tepples (727027) | more than 6 years ago | (#21597887)

A non-compete only benefits the employee if they get something in return for the duration of the non-compete.

What the employee gets in return for a non-compete agreement is a job. This offers the opportunity to earn and save money while employed, in order to be able to live off the savings during the term of the covenant not to compete.

</devils-advocate>

Re:Don't feed the competiton (0)

Anonymous Coward | more than 6 years ago | (#21598141)

What the employee gets in return for a non-compete agreement is a job.

In that case, the non-compete should terminate at the same time that the job does.

CORRECTION (1)

tepples (727027) | more than 6 years ago | (#21598217)

What the employee gets in return for a non-compete agreement is a job.
In that case, the non-compete should terminate at the same time that the job does.
I meant to say: What the employee gets in return for a non-compete agreement is the saved income from having had a job.

Re:Don't feed the competiton (0)

Anonymous Coward | more than 6 years ago | (#21598243)

However if they already have a job, and are encouraged to sign a non-compete to keep it, they have nothing to gain by signing it.

[Particularly since their previous contract didn't have a date of expiration or anything else that would make it not apply when the new contract is offered. If fired over not signing a new contract... well, that sucks, hire a laywer]

reality of non-competes (1)

rubycodez (864176) | more than 6 years ago | (#21598295)

nonsense, a person who's worked for three years won't be able to save up enough to live for two more years. The reality is non-competes are more often not upheld. always check the laws where you live, you might be surprised at how enforcement of non-compete varies by nature of work, position level, etc.

Re:Don't feed the competiton (1)

networkBoy (774728) | more than 6 years ago | (#21598523)

My non compete states that I can not work for the competition for 6 months. The competition is basically anyone in the semiconductor industry. I thought that was un-equitable, seeing as I was getting very little in exchange for 6 months of unemployability, so I re-negotiated. I now stay on payroll till they decide I am no longer in possession of trade secrets then will let me go without any non-compete. In a nutshell:
If I leave: 6 month non-compete
If they tell me to leave: 6 month non-compete and 6 months pay + benefits. Realistically I expect they would keep me on staff but transition me to non-technical jobs (facilities support, purchasing, etc.) for the duration of the 6 months.
-nB

Re:Don't feed the competiton (1)

vidarh (309115) | more than 6 years ago | (#21598719)

If so you should expect a significantly higher salary when in jobs with a non-compete. I've yet to see companies asking for non-competes offering a higher salary than those who don't, though I'm sure it happens in some cases.

Re:Don't feed the competiton (1)

cthulu_mt (1124113) | more than 6 years ago | (#21597631)

So you can't use your expertise to make a living for 5 years? Or does you contract have your employer paying you severance for 5 years?
Two different things. I've acquired many useful skills in the 2.5 years I've been here and they will help me in the future. My contract prohibits me from starting a company that does X*. I'm not a software engineeer or IT guy. My situation is more akin to PepsiCo prohibiting an employee from starting their own soda comapny.
I won't get a severance, but I do get paid very well, with benefits.

*Sorry, confidential.

Re:Don't feed the competiton (1)

arivanov (12034) | more than 6 years ago | (#21598047)

In most of Europe (except surprise, surprise, UK) for this to be enforceable they have to pay you for 5 years your normal salary. Nobody in his sane mind does that so nobody tries to put mad clauses about non-compete into contracts. UK is once again one of the few significant exemptions.

Re:Don't feed the competiton (1)

kcdoodle (754976) | more than 6 years ago | (#21599201)

If your company make gas turbine engines, then you can't work for another company that makes gas turbine engines.

If you are a programmer, this is rarely a problem.

If you are a mechanical engineer who specializes in gas turbine engine design, this is a big problem.

Being a programmer, this has never been a problem, but I still will not work for a company who makes me sign such an agreement. Good programmers can find good jobs nearly anywhere.

I have worked in the power industry, telcoms, universities, banks, government, web hosting, and more, never the same thing twice. (It's more fun that way.)

Re:Don't feed the competiton (3, Insightful)

UnknowingFool (672806) | more than 6 years ago | (#21597207)

It makes perfect sense though; why fill my head with Trade secrets and methods just to have me open up shop across the street.
Hell, that's how my boss got started. His employer didn't have a non-compete clause and he proceeded to run them out of business. Competition is the core of good Capitalism but nothing says you have to help your enemies.

Whether you have a non-compete agreement with an employer or not does not address the issue of trade secrets. Unless your former employer gives explicit permission to share trade secrets, you can never share them with any other employer. Period. The same thing applies to source code. Now do people break that rule when they go to another company? Yes, it happens but they open themselves up to litigation. The question is whether non-competes harm innovation by placing an restriction on who can employed.

Re:Don't feed the competiton (1)

sed quid in infernos (1167989) | more than 6 years ago | (#21597387)

"Whether you have a non-compete agreement with an employer or not does not address the issue of trade secrets. Unless your former employer gives explicit permission to share trade secrets, you can never share them with any other employer."

Technically, this is true. However, without some explicit protection such as a confidentiality agreement, trade secrets don't exist, because taking reasonable means to protect the information is an element of trade secret formation.

Some agreement with the employees who have access to information is almost certainly necessary to gain trade secret protection for that information. This agreement does not have to be a non-compete agreement.

Inevitable disclosure (1)

tepples (727027) | more than 6 years ago | (#21597933)

Some agreement with the employees who have access to information is almost certainly necessary to gain trade secret protection for that information. This agreement does not have to be a non-compete agreement.
Courts in some jurisdictions have held that someone working for a competitor will more than likely inevitably disclose [google.com] a former employer's trade secrets, even if only by negligence.

Re:Don't feed the competiton (1)

cdrguru (88047) | more than 6 years ago | (#21598105)

Maybe. Probably not.

The problem is if I hire a developer that comes from a company with a competing product it is highly unlikely the company I hired him away from is going to be able to actually claim something new is the result of "trade secrets" that the developer brought (illegally?) with him. Where would you go to get any sort of evidence of this?

Now, if there is a non-compete agreement that I knowingly violate by hiring the developer, I am putting my company and the developer in trouble. There isn't any need to collect evidence - it is pretty obvious what is going on.

No, I don't think you are going to get very far trying to find trade secrets being shared improperly. Customer lists, maybe but even that is questionable.

Re:Don't feed the competiton (4, Insightful)

Rob the Bold (788862) | more than 6 years ago | (#21597233)

My contract prohibits me from engaging in the same business as my current employer for up to 5 years after termination. It makes perfect sense though; why fill my head with Trade secrets and methods just to have me open up shop across the street.

That's their motivation for the non-compete: it's better for them. By the same token, not having a non-compete would be better for you, since you could easily turn around that argument saying "why should I fill their pockets with money just to have them lay me off in bad times". If it's OK for an employer to look after their own interests, then certainly it is OK for an employee, too.

TFA, on the other hand, suggests that the practice of non-competes reduces overall innovation. So what's good for an individual employer is not necessarily best for society at large. So society might have an interest here in looking out for its own, also.

nothing says you have to help your enemies.

BTW, if you view your employees all as potential enemies, you might not be getting their best efforts.

Re:Don't feed the competiton (2, Informative)

Alsee (515537) | more than 6 years ago | (#21598999)

TFA, on the other hand, suggests that the practice of non-competes reduces overall innovation. So what's good for an individual employer is not necessarily best for society at large.

It's not even necessarily good for an employer, however much he thinks he wants it.

An employer wants a non-compete to cut off harmful "outflow" of value. However if the practice of non-competes is legally enforced, then by definition it also cuts off his own beneficial inflow of value. And the direct benefit to an employer of any inflow value is almost always going to be larger than the diffuse indirect negative impact to the employer from outflow.

So in a state that enforces non-competes, yes an employer may have a selfish interest in trying to impose non-competes on their employees. However the practice itself is not good for the employer, and in fact leaves him at a disadvantage relative to companies in other states that do not enforce non-competes, leaves him at a disadvantage to companies that do benefit from inflow. In the same way that Boston's Route 128 tech center (subject to non-competes) was trounced by Silicon Valley and California's non-enforcement of non-competes.

So the employer's short view interest may be in pushing non-competes for his employees, but his true interest is in opposing the practice itself and opposing state enforcement of the practice.

Kinda like a politician who accepts corporate campaign contributions, and says he will (and who does) vote to prohibit corporate campaign contributions every chance he gets.

-

Re:Don't feed the competiton (1)

Bert64 (520050) | more than 6 years ago | (#21597693)

And is your job core to that business? Or do you do something that's ancillary to the core business of your employer?
Or to put it another way, do you think that, with your skillset, you could earn the same or more more working somewhere else that isn't in the same line of business?

If not, then your screwed. Your current company can hold you to ransom, if you decide to leave you can't work in the industry you are trained for and have experience in, you have to do something else for which your not trained, which means you have to start at a lower level earning less money.

Some countries make non compete clauses illegal and unenforceable, but at the very least an employer should be required to compensate you for the duration of any such contract that inhibits your ability to earn a similar or higher wage.

Re:Don't feed the competiton (1)

Solandri (704621) | more than 6 years ago | (#21597759)

Hell, that's how my boss got started. His employer didn't have a non-compete clause and he proceeded to run them out of business. Competition is the core of good Capitalism but nothing says you have to help your enemies.
You're making an incorrect jump in your reasoning, that if the action is beneficial for individual party, it must be beneficial for all parties as a whole. That's not [wikipedia.org] always true [wikipedia.org] . It's possible to have situations where if all individuals choose the action most beneficial to themselves, everyone can arrive at a worse situation than if they had made sub-optimal choices.

That's what the article is claiming - that although non-competes give the appearance of benefiting the individual companies, they harmed Boston's tech industry as a whole to the point where it fell behind the same industry in Silicon Valley. In other words, the competition in Silicon Valley which forced companies to "help their enemies" as you put it actually produced better results.

Sounds dangerous (1)

Chrisq (894406) | more than 6 years ago | (#21597909)

What if your employer goes bankrupt, makes you redundant, or gets taken over by a company that wants you to relocate to Japan? You could be in a sticky situation.

Wrong attitude. (1)

SanityInAnarchy (655584) | more than 6 years ago | (#21598493)

It makes perfect sense though; why fill my head with Trade secrets and methods just to have me open up shop across the street.

The problem with your attitude here is, you're thinking about what's good for the company, not what's good for you. While you won't be able to take any trade secrets if they've had that covered properly (NDA, worst case), why not insist that you retain that ability?

In other words, yes, it would suck for that company if you just open up shop across the street. But if you're anything like most of us, it's a lot harder and riskier to start your own business than to work for a boss -- particularly if you're working in a business that tends towards companies big enough to have a boss in the first place.

So, it's a way to make your employer at least try to keep you happy, if they know you can always do that. But they don't even have to try that hard, because it is so hard to "just open up shop".

Competition is the core of good Capitalism but nothing says you have to help your enemies.

And that is the core of what's wrong with your employer, if that's their attitude.

You are an employer, not an enemy.

From what I remember of my own contracts, the worst was the NDA. That is, I can't disclose their trade secrets, ever, whether I leave or not. But the only thing I remember about not competing was that I can't compete with them while working for them -- if I leave, I can do whatever I want.

But rather than enforcing a lot of paperwork -- each contract I signed was less than two pages -- they instead make me want to stay [flickr.com] . Because if I don't leave, any kind of noncompete extending past the term of employment is completely irrelevant.

Re:Don't feed the competiton (1)

j987123 (885515) | more than 6 years ago | (#21599285)

IA companies trade secrets are going to be protected one way or another. For example, I believe California has very strong trade secret protection but IANAL.

The biggest problem I see with non-competes is they stifle innovation. An employee may have good innovative ideas to which management is unreceptive. With a rigorously enforced non-compete agreement the employee is stuck. However, in a state that does not enforce non-compete agreements the employee can take is innovation to a company willing to develop it.

In Democratic Canada... (0)

Anonymous Coward | more than 6 years ago | (#21597019)

these were made in enforceable as a company does not have the right to deny you a living. In the us it could most likely be argued in the same manner

That's the big difference (1)

Anonymous Brave Guy (457657) | more than 6 years ago | (#21597227)

Exactly. The fundamental difference between non-compete clauses in employment contracts and DRM is that in most jurisdictions, one of them usually doesn't hold up in law when it matters, while unfortunately the other one apparently does.

Re:In Democratic Canada... (1)

Bert64 (520050) | more than 6 years ago | (#21597841)

In the UK too, such clauses are known as "restriction of trade" and aren't legal...
A lot of companies still include them tho, with the intention of scaring people who don't know any better.

Dawn of understanding (2, Insightful)

WoodstockJeff (568111) | more than 6 years ago | (#21597033)

Non-compete has existed for decades, long before DRM. It would make a lot more sense to reverse the comparison, but some people have no concept of what came before their own awakening to the ways of the world...

Hear! Hear! (2, Interesting)

Per Abrahamsen (1397) | more than 6 years ago | (#21597367)

That non-compete agreements are damaging is well known to anyone with any economic understanding, a market economy is based on competition. If you take that away, you are left with something as even worse than the old communist economies. A planed economy without the planning part.

Whether you call it anti-compete agreements, guilds, trusts, or five year plans, the result is the same. Short time gains for a few, long time economic stagnation for everybody.

Anyone wanting the state to enforce non-compete agreements is either deeply corrupt, or deeply incompetent. There is no third possibility.

The economic case against DRM is far less clear cut. The strongest arguments against DRM are not economic, but moral, and concerns the loss of consumer rights. And are as such much weaker, going against economic theory is just stupid, going against a specific moral theory is obviously a value judgment.

Re:Dawn of understanding (1)

jesdynf (42915) | more than 6 years ago | (#21597535)

But DRM is understood to be worthless, contemptible, and without value. Now that we've come to an understanding about that, it could be considered worthwhile to compare it to other things that exist, to see if our new understanding about one aspect of our world has any implications on other aspects of it. So the comparison is working in the right direction after all.

Re:Dawn of understanding (1)

bishiraver (707931) | more than 6 years ago | (#21598635)

Seriously. The reason it took Morimoto a long time to open up a restaurant in NYC was because his former restaurant (for which he was not the head chef) had a non-compete clause. He could not open up a restaurant within NYC for a specified number of years. So he opened his flagship restaurant in Philadelphia, and only recently has opened up a restaurant in NYC.

Florida (2, Interesting)

Jaysyn (203771) | more than 6 years ago | (#21597105)

Florida is great. I'd have to actually leave & take my current employer's customers with me for them to have any chance of enforcing a non-compete here. I think this holds true in most right-to-work states.

Re:Florida (2, Interesting)

ShawnCplus (1083617) | more than 6 years ago | (#21597351)

I don't think it's defined per state. My non-compete says that I can't solicit any of their clients for 2 years for any work. As long as I don't snatch up someone they've been working with the non-compete doesn't inhibit any of my actions.

Re:Florida (2, Informative)

negative3 (836451) | more than 6 years ago | (#21598919)

How does right-to-work laws apply to non-compete agreements? To quote wikipedia, right-to-work laws "prohibit agreements between trade unions and employers making membership or payment of union dues or 'fees' a condition of employment, either before or after hire." Unless Florida has added more to the concept of a right-to-work law.

Non-compete (3, Interesting)

canuck57 (662392) | more than 6 years ago | (#21597173)

I really don't have a problem with extened non-competes with in some limits.

But then the company also has to pay your wages in full during the non-compete period and a generous severance beyond that period.

That is, you allegiance or commitment to any non-compete ends when the pay cheque ends.

Re:Non-compete (1)

swillden (191260) | more than 6 years ago | (#21597453)

But then the company also has to pay your wages in full during the non-compete period and a generous severance beyond that period.

That's going a bit far. If you quit, why should they pay you severance? The wages during the non-compete period I could see, but what's to prevent an employee from quitting specifically to exploit this? Hot dog! My employer had me sign a four-year non-compete agreement, time for me to go get a master's degree!

Your suggestion is not well thought-out, unless your purpose is really to say "non-competes are okay as long as we make sure that no sane company would ever ask anyone to sign one".

Re:Non-compete (1)

Bert64 (520050) | more than 6 years ago | (#21597581)

And no sane person would ever sign one...
I mean you work in a given industry doing a given job, if you move companies chances are your going to be doing the same or a similar job because thats where your skill set lies. A no compete clause, if even enforceable (they are illegal in some countries, restriction of trade) basically prevents you getting a job doing whatever it is you do for the duration of the clause.
Therefore, an employer making you sign such an agreement should have an obligation to pay you for that time your unable to work, tho they could be free to do something else for that time providing it's not overly demanding (relative to your actual job) or demeaning etc..

The idea that a company can say "when you leave us, you cant do the job your trained for and skilled at for a year, you'l have to do an unskilled job for a year on minimum wage" is ridiculous.

Re:Non-compete (1)

zotz (3951) | more than 6 years ago | (#21598985)

"I mean you work in a given industry doing a given job, if you move companies chances are your going to be doing the same or a similar job because thats where your skill set lies."

Hey! You wanna join the band as drummer? Sure, here, sign this non-compete.

You mean I can't work as a drummer anywhere for 5 years if you kick me out of the band or if it doesn't work out and I leave?

Right! Everyone does it!

all the best,

drew

Re:Non-compete (1)

Creepy Crawler (680178) | more than 6 years ago | (#21597617)

There's no sane reason to take away someones way to make money.

The only response to that is by a non-compete reversal: If the company deems that you are too valuable, they SHOULD pay you to not work. After all, it is a contract, which means for a certain loss, there almost always is the opposite gain in another way.

It really comes down to this: Lump it or leave it.

Re:Non-compete (2, Informative)

canuck57 (662392) | more than 6 years ago | (#21597925)

Your suggestion is not well thought-out, unless your purpose is really to say "non-competes are okay as long as we make sure that no sane company would ever ask anyone to sign one".

Having been under a few, and had to fight one, and won with prejudice I can can say most non-competes are rope around your neck documents. Often they want you to sign after accepting the job or change rules 3 years into employment. Puts people in the situation of having to comply or be on the outs. Fortunately where I live, an employer can try to do this but a judge wouldn't even hear of it as if not signed with or before the offer, unless in the employees favor - it legally has no value.

Employers want the right to fire, I have no problem with this. Really, I am for employer and employee rights. Both sides. But when an employee is restricted in practicing his skills for another employer, then the former has to pay his bench time or forget about it. That is, no one can stand in front of a persons right to practice their legal profession unless they are going to put their money where their mouth is.

Re:Non-compete (2, Insightful)

apt142 (574425) | more than 6 years ago | (#21598757)

That's going a bit far. If you quit, why should they pay you severance? The wages during the non-compete period I could see, but what's to prevent an employee from quitting specifically to exploit this? Hot dog! My employer had me sign a four-year non-compete agreement, time for me to go get a master's degree!
I don't see a problem with people exploiting this. After they've done it enough times, it'll become obvious that they are a scammer and then will become either non-employable or unfit to work with trade secrets. With this heavy of a penalty on companies who insist on non-competes then they'll really put the investment up front to look into things like this. They'll also not throw them around so frivolously.

If you have a non-compete clause on you, you obviously are (or damn well should be) doing something that's important to the company's intellectual property. If so, the company should treat you well and respect you for being in such a position.

Also, if a company wants to prevent me from using my IT knowledge for 5 years, they had better damn well pay me. Five years in computing is a long, long time. If after those 5 years I want to return to the field, I'm going to need education, certifications, etc. to make up for the lost field experience and to get me up to date.

Re:Non-compete (0)

Anonymous Coward | more than 6 years ago | (#21597679)

That's how it works in the UK, they're unenforceable once they stop paying you.

Don't sign them! (3, Insightful)

FredDC (1048502) | more than 6 years ago | (#21597179)

DRM ? Don't buy it!
Non-compete? Don't sign it!

It's that simple... If a company wants you to sign such an agreement, it says alot about the corporate culture of that company. It means management thinks it completely owns the people who work for them.

It could also mean some people have already left the company to work for competitors and they're trying to protect themselves from this happening again. That tells me it's probably not a nice place to work at, if people leave to go and do the exact same job somewhere else!

Re:Don't sign them! (0)

Anonymous Coward | more than 6 years ago | (#21597727)

When I first started working for my company, this is exactly what happened. We didn't have non-competes at the beginning, but then some people started leaving to competition and they forced us to sign non-competes. Even worse, they pre-dated the forms on there to say that we had signed it when we started (even if it was years before... a year in my case). I did sign it, but I put the date I signed it next to my signature. Not that it makes a difference, but I thought it was sleezy that they would pre-date the form like that. Now I'm not supposed to work for a company that happens to provide the same services they do for five years... even if I work in a different department entirely. I'd like to see them enforce it across state lines though (I'm remote).

Re:Don't sign them! (1)

Tim C (15259) | more than 6 years ago | (#21598735)

They can force you to sign a contract, and that contract is still binding? *And* it was back-dated? That right there is your first problem. The fact that they did it is just icing on the cake.

Re:Don't sign them! (1)

aaarrrgggh (9205) | more than 6 years ago | (#21598377)

Most non-compete agreements are an HR issue more than a real management initiative. Having been on both sides of the argument, up close and personal, I have to say that I prefer California's interpretation. At-will employment and non-compete agreements have no place together.

Now, if an employer and employee have the expectation that it is a lifetime engagement and not something terminated at the whim of a quarterly profit projection, a non-compete agreement is much more logical. Not a whole lot of individuals or companies are in this position today.

Re:Don't sign them! (1)

Snocone (158524) | more than 6 years ago | (#21598767)

Here in British Columbia the courts have held that a signed non-compete agreement can only be enforced for as long as the company pays the full termination salary of the non-competee. If they won't pony that up, then they can't stop you earning a living with your skills as you see fit.

Far as I'm concerned, that's the PERFECT legal interpretation of a non-compete agreement. You can pay me full salary to do nothing, or you can piss off and stay out of my way; hey, sure, take your pick, ex-boss!

Re:Don't sign them! (1)

shutdown -p now (807394) | more than 6 years ago | (#21598601)

DRM ? Don't buy it! Non-compete? Don't sign it!
And then, if all "intellectual property" that is sold is DRMed, and all jobs require you to sign a non-compete, you're screwed.

Re:Don't sign them! (1)

attam (806532) | more than 6 years ago | (#21598731)

"dont sign" is not always an option. my first job out of school was at a proprietary trading firm where we did not have non-competes. at the end of my second year, we were presented non-compete forms which we were REQUIRED to sign in order to have our bonuses disclosed to us. in that industry, your bonus can be anywhere from 50-90% (or more) of your total pay, so I would have been forgoing a lot of cash by not signing. pretty much extortion, yes, but thats the biz.

Re:Don't sign them! (0)

Anonymous Coward | more than 6 years ago | (#21599361)

"Don't sign" is always an option. They made you an offer, and you accepted it. You could have chosen to find different work.

Indentured Servitude (0, Flamebait)

postbigbang (761081) | more than 6 years ago | (#21597191)

Lincoln freed the slaves.

We all have free speech and right to association as part of the First Amendment.

Sign such an agreement, and you give up your rights to both.

Capitalist tool.... and another wedge against the spirit behind "We the people...." as opposed to "We, the slaves to stockholders...."

Applause to California and other states that don't enforce these enslavements.

Re:Indentured Servitude (0)

Anonymous Coward | more than 6 years ago | (#21597361)

sure you have the right not to be a slave...you also have the right not to earn a living, a lot of people don't have a choice but to sign, they have these things called families they are responsible for.

Re:Indentured Servitude (1)

postbigbang (761081) | more than 6 years ago | (#21597751)

Slavery has only time to honor it, innovation to suffer from it, and the master-slave context to remain after that that employment is terminated for reasons that only a stockholder could love. Fie.

There is a mechanism for this to work (1, Insightful)

Anonymous Coward | more than 6 years ago | (#21597205)

In his book, 'The Innovator's Dilemma' http://www.businessweek.com/chapter/christensen.htm [businessweek.com] , Clayton Christensen points out that disruptive technologies often/usually are invented by large entrenched companies. They can't take advantage of the technology because their business practices prevent it. It makes sense that an employee, familiar with the work, would start a company that could take advantage of the new technology.

Viewed in this light, the old entrenched companies are the dog in the manger. They can't take advantage of the technology they invented, because they can't make enough money on it to cover their overhead, but they sure don't want anyone else to develop it. Non-compete contracts are one way to make sure that doesn't happen.

Re:There is a mechanism for this to work (0)

Anonymous Coward | more than 6 years ago | (#21598367)

OK, fine. Then the price of making this work is an unconditional severance agreement that pays salary and benefits to run concurrently with the entire non-compete period. Employer wants a 5 year non-compete period? No problem! Just pay me.

A federal law that mandates no loss of salary or benefits during a non-compete period would allow market forces to make the process reasonable. It would instantaneously solve the problem that has to be solved -- how else do they think the employee is really going to earn a living? Adding a cost proportional to the term of the agreement would vaporize most of the problem in no time. Otherwise, the attorneys just run up billable hours trying to make each new version of the agreement a little oppressive than the one before. Something has to provide balance to the equation.

I know of one case where the employer was letting someone go (in sales). They had neglected to get a signed non-compete, so the CEO asks her to sign one as they are dismissing her. She laughed and counter-offered with full salary for whatever non-compete period they wanted. The employer paid for a year. Now she works for the competition and is doing exactly what the original employer was afraid of. However, they have now lost so much business in that area that enriching the competition is just one of many critical problems.

What I propose is pretty much what employers do anyway when they want a non-compete and it's too late to apply the normal coercion tactics.

Re:There is a mechanism for this to work (1)

Spy der Mann (805235) | more than 6 years ago | (#21598437)

They can't take advantage of the technology they invented, because they can't make enough money on it to cover their overhead, but they sure don't want anyone else to develop it. Non-compete contracts are one way to make sure that doesn't happen.

And software patents are another.

useless sheets of paper (0)

Anonymous Coward | more than 6 years ago | (#21597275)

few judges will uphold a non-compete, so they are basically useless sheets of paper.

Re:useless sheets of paper (1)

Bert64 (520050) | more than 6 years ago | (#21597883)

Not useless, they serve to scare people into compliance...
A lot of people don't realise non compete clauses aren't enforceable, and thus comply with them out of fear instead of doing the proper research.
This deters people from leaving, as they fear they couldn't earn the same level of money elsewhere.

drm, retarded patents, noncompetes... (1, Insightful)

circletimessquare (444983) | more than 6 years ago | (#21597303)

it's all an example of the corporatization of our creativity and our culture

it's sort of the opposite of communism, where it was believed that by expelling selfishness as a motiviation in life, all will be enriched. when in reality, communism just makes all of society as poor as its poorest member, as selfishness is a motivation to succeed and do better, and this enriches society in indirect ways

meanwhile, business law thinkers know that innovation is the wellspring of all of their profits. so the idea is to lock in the wellspring of creativity at earlier stages, so as to ride the wave to greater and greater financial success later

but actually, locking the wellspring of innovation at earlier and earlier stages has the perverse effect of killing the wellspring of innovation

so much like the paradoxical dichotomy that ruins communism (that selfish behavior leads to rich societies), there is a paradoxical dichotomy at work when it comes to business, the law, open culture, and creativity: if you let innovation proceed freely, it will enrich your business more in indirect ways than if you try to cage it

itr's counterintuitive, and it goes against the human desire to control things, even that which they cannot control, and if they just stopped trying to control it, they would actually be richer, figuratively and literally

Re:drm, retarded patents, noncompetes... (1)

aadvancedGIR (959466) | more than 6 years ago | (#21597935)

Absolutely, moreover, if you manage your capitalistic corporation in a communist way (everyone except the leaders get crappy pay, and they better have to thank us), people either don't want to innovate or don't work to innovate FOR YOU.

As said by Gibbons in Office Space: "It's a problem of motivation, all right? Now if I work my ass off and Initech ships a few extra units, I don't see another dime; so where's the motivation?"

Tragedy of the commons (5, Interesting)

nickovs (115935) | more than 6 years ago | (#21597433)

It seems to me that non-competes are a classic example of what economists refer to as the Tragedy of the commons [wikipedia.org] . For any individual company it makes sense to get your staff to sign a non-compete, to stop them taking elsewhere the knowledge you've paid them to acquire. For a technology cluster as a whole (e.g. Silicon Valley or Route 128) the overall effect is negative due to stagnation in the workforce. The problem is that existing firms don't have an immediate incentive to worry about stagnation in start-ups; they are more concerned about loosing good employees to their competitors.

The Tragedy of the Commons crops up all over the place - the most frequently seen cases are things like over-exploitation of natural resources. Generally there are only two ways to deal with the problem; one is to legislate against the behaviour that is detrimental in the longer term and the other is to convince the players to take a longer term view. What's interesting about this debate is that there are people who do have a longer-term interest as well as some sway over the companies: the venture capital firms that invest in not just one start-up but many start-ups over a period of time. They have an incentive to make the environment the best for all companies to thrive. I hope Bijan Sabet manages to convince a few more of them!

Re:Tragedy of the commons (0)

Anonymous Coward | more than 6 years ago | (#21599051)

You missed a third way: break up the commons.

Anything that gives each party an interest and control over just a part of the commons (e.g., property rights) give them a strong incentive to take a long term interest in that part.

Divide the common pasture land among the herders, and each will start taking care of the pasture that they have. Partly because they know that if they wear it out, they'll no longer have any pasture for their herd. Partly because no one else (without their permission) can use their pasture, so they will receive the benefits of caring for it.

Territoriality serve this purpose among animals, each wold pack has it's own hunting range, which other packs stay out of. Thus wolves avoid over hunting.

Correlation != Causality (2, Insightful)

cybermage (112274) | more than 6 years ago | (#21597485)

I don't know that you can link the difference between Boston and Silicon Valley to enforcement of non-compete agreements. Here's some other equally likely candidates:

San Jose [meteo.fr] has better weather than Boston [worldweather.org] . Maybe people with a choice of where to work choose a nice place to do it.

San Jose [salary.com] pays programmers slightly better than boston [salary.com] . Maybe people like to be paid more.

Why are people always so eager to boil complex situations down to a variance in a single variable in an attempt to prove a point?

Re:Correlation != Causality (5, Insightful)

Anonymous Coward | more than 6 years ago | (#21597885)

Yeah, because those stupid statisticians at Stanford etc. don't consider other variables when they do their statistical analysis

For example - from the article.
Gilson looks at a few of the other possible explanations for the difference and shows how they're all lacking, leaving the difference in noncompetes as being the key difference between the two regions in terms of the flow of information and ideas leading to new innovations.

You can even follow through and read the sources linked from the original article
eg.http://papers.ssrn.com/sol3/papers.cfm?abstract_id=124508

Why are people on the internet always so eager to think that highly qualified economists at world class Universities will have failed to consider the one blindingly obvious thing to consider about a situation, simply based on reading a one line summary of the relevant paper, in order to prove some clearly stupid point?

Re:Correlation != Causality (1)

aadvancedGIR (959466) | more than 6 years ago | (#21598049)

And maybe the corps in Boston benefit in hiring people who cannot afford to go to San Jose and treating them like crap.

Somehow, it always falls down to a simple balance: do the people accept a job because it is a good one or because they have no other choice?

Noncompetes not common in Boston (1)

TheMCP (121589) | more than 6 years ago | (#21599309)

Having worked almost all of the 19 years of my professional career in Boston, only once have I ever been asked to sign a noncompete agreement. Before signing it, I checked with a few professionals (including, informally, a lawyer) and was told that it could only apply if I voluntarily left the employer with whom I had the agreement to go to a competitor, and it only applied for 3 months anyway.

Noncompetes just aren't common in Boston.

I don't know what you people expect (0, Flamebait)

iminplaya (723125) | more than 6 years ago | (#21597539)

This is all a perfectly natural evolution of your IP laws. It simply cannot go any other way. When you want to stomp your "enemy's" (meaning everybody but you) into the ground, if you want to push him off the cliff as you scramble to the "top", this is the way to do it. Anybody who has their eyes open can see this coming a mile down Broad Street. Mo' money Mo' money Mo' money. Enjoy your "free" market. From my perspective, you all are putting up lots of great entertainment. It's like watching the ants in my garden fight over a leaf. By all means, carry on.

Re:I don't know what you people expect (1)

iminplaya (723125) | more than 6 years ago | (#21597573)

Cue the spelling/grammar nazis...I meant enemies. This post is a preemptive "shhh".

Enforceable? (1)

Lobster Cowboy (605052) | more than 6 years ago | (#21597571)

How enforceable are non-competes anyway? A couple of years ago I worked for a design house that made me sign a non-compete. I was terminated two weeks into the job, and three months later got a new design job. The terms of my non-compete stated that I couldn't work for another studio for one year after termination, but I obviously disregarded that. What's the track record for enforceablity of these agreements?

Re:Enforceable? (1)

cdrguru (88047) | more than 6 years ago | (#21597871)

It depends. Mostly, overbroad claims are nonsense. However, if you took it upon yourself in your new design job to call clients that you remembered from your two weeks and used knowledge of failings in the first company to lure their clients away, this would probably be actionable.

Most often however your non-compete would simply make it difficult to get hired by a new company that clearly was competing over clients with the old company. Unless the new company wants to try to defend in court their decision to hire you, it is much simpler and safer to exclude people with valid, reasonable non-compete agreement from the hiring process. Now if you lie about having one and it comes up later, you are going to find yourself in a difficult place indeed - your new company may just fire you for lying on your application. Regardless of whether or not they would have hired you or not if they knew about the non-compete.

Re:Enforceable? (0)

Anonymous Coward | more than 6 years ago | (#21598707)

How enforceable are non-competes anyway? A couple of years ago I worked for a design house that made me sign a non-compete. I was terminated two weeks into the job, and three months later got a new design job.

It depends -- leaving versus getting fired for one. If you were laid off as they didn't have work for you / didn't like you then they probably can't enforce the non-compete. If you were canned as you were secretly planning to steal their trade secrets then yes they can try and enforce it. If you quit they are more likely to try to enforce it.

Human nature (2, Insightful)

Ghubi (1102775) | more than 6 years ago | (#21597603)

People don't like to compete. People like to win. People are forced to compete in order to win. Competition brings out the best in people. Given a choice between competition and a guaranteed win, people will almost always go for the guaranteed win.

Patents, non compete agreements, and organized crime are all designed to provide an automatic win without the need for competition.

This is one of those oddities that should be (2, Interesting)

zappepcs (820751) | more than 6 years ago | (#21597721)

taken care of in the manner of one trade secret at a time. Every time that you, as an employee, are exposed to information deemed a 'trade secret' then the employer should have you sign a specific agreement on THAT piece of information. The catch all non-compete is like agreeing to binding arbitration. Both are overly broad, and designed to give the other party the upper hand in all cases where the future brings conflict. Making such a promise is no more enforcible than the marriage vows many people take. Marriage was once viewed higher than today, but today, you can get a divorce with little or no real effort. The same should be for any particular 'business agreement' where money has not exchanged hands.

That is to say that if a court can find in favor of the non-compete agreement, you should be able to get a divorce, or sue for compensation. I do not know if this has been tested, but I'd bet a couple of court cases is all that would be required to break that camel's back.

"human capital"? (1)

Voline (207517) | more than 6 years ago | (#21598009)

Yeah, umm. There is no such thing as "human capital". Capital is a store of value that is used to acquire the means of production (plant and machinery), raw materials and labor that is then used in production of something to be sold on the market.

What you are calling "human capital" has been known previously as "labor", as in "non-competes as the DRM of labor". But apparently in this amazing new, new economy labor is no longer required, production is a process of just "capital" and ummmm "human capital".

Excuse me, I gotta go to work now.

Re:"human capital"? (1)

Faylone (880739) | more than 6 years ago | (#21598457)

'human capital' sounds nicer than 'slaves'

Human Capital?? (1)

dentar (6540) | more than 6 years ago | (#21598191)

Huh?

Advice for EVERYONE: Don't sign these things, ever. Never, ever sign a non-compete. Just don't do it. I did and luckily it wasn't a super-long term. Also, if a company forces you to use a non-compete, find out BEFORE accepting the job offer. If a company that you've been working for comes along and asks you to sign it, call your lawyer immediately.

Bad Analogies as the DRM of Human Discourse (1)

munch117 (214551) | more than 6 years ago | (#21598231)

Writing annoyingly bad titles is an art form onto itself. What'ya think, can my subject line compete with the article title, or should I throw in a ", says industry analyst" for good measure?

Two separate things (1)

cdrguru (88047) | more than 6 years ago | (#21598361)

Every "non-compete" agreement that I have ever signed or given someone to sign is first and foremost a statement of ethics. The employee understand they are going to have some valuable materials at their disposal and to either share these with a competitor or to run out and start a business using them would be unethical. And possibly lead to legal sanctions.

The second part is assignment of inventions which is almost alway completely separate. Or at least it should be. If you are employed in a "creative" capacity where it is your job to come up with new things, do you honestly believe that you should have the right to (a) come up with something new that is within the scope of your job, (b) quit, and (c) form a new company to exploit this new idea?

Maybe you are thinking "Nobody would be that stupid!" but it has been done. Exactly like that, within the period of a few days, not weeks or months. It has even been done at the level where the new idea has been completely researched and proven to the point where it could be implemented. And they the "inventor" walks away to do it all independently. Motivations differ, but usually it is because their brother-in-law (the attorney) sold them on the idea that they could "make billions" this way and they would never see anything from it if they stayed with the company that paid for the research time.

Sure, there are people that have tried to behave ethically and gotten screwed. But for every one of those there have been people that have lied, cheated and stole from their employer. And in my experience the far larger quantity has been on the side of unethical behavior.

I don't understand how they enforce them (1)

swb (14022) | more than 6 years ago | (#21598363)

...unless you're some key scientist at a major corporation.

For "average" techies who have to sign them, how do they know where you go to work when you quit and how much effort will they put forth to actually enforce it?

I work for a small consulting company (20 people) and they made new guys sign non-competes and tried to get existing employees to sign them (I said sure, for $10k consideration and a full salary and benefits guarantee during my non-compete period, they said not to worry about it then).

But if I quit my job, I just go into my boss' office, hand him a resignation letter that says "Thanks for the opportunity. My last day is Month XX, 20xx. Please have any final checks available on this date as I am relocating and do not have a forwarding address." I don't tell them where I'm going, I don't tell them who I'm working for (if really pressed, "looking into several opportunities I do not wish to discuss").

I just find it hard to believe that a company my size, or even 10 times my size, is going to go through the hassle of hiring an investigator, an attorney and spending possibly a year of my salary to keep me from working. I mean, they have to FIND me, FIND where I'm working and be able to prove it in court. That's not trivial.

Now, if you're a really key exec or scientist or something at a company with real, real deep pockets or you do some real obvious, high profile job change that even the tabloids can track, I can see where they could spend the money (or not need to) to enforce them. But for everyone else it just seems like a BS corporate bluff.

It's all BS (4, Informative)

joeyg1973 (1199299) | more than 6 years ago | (#21598665)

I have dealt with this before. My lawyer told me that only one or 2 of these cases have ever made it to the court. Judges throw these cases out as soon as they see them. Your previous employer cannot tell you where you can and cannot work. It is taking away your ability to earn a living. I had worked for a company for 2 years, went to their direct competitor for more money for a year, then came back to the first company. Both times I got a very official and long letter from the former company's law firm chastising me about the non-compete and asked me to respond within a certain time limit to some questions in the hope that I would write something that was actionable. Both times I ignored the letters, the time limit came and went, and nothing further happened. I have a friend who was in a similar situation and his former company decided to press the issue. It never made it to court, judge just threw it right out. I believe that the only way that a non-compete can be enforced is if the company can show significant monetary damage has occurred. Working for whomever you want is still perfectly legal in the USA!

Essential Difference (1)

RAMMS+EIN (578166) | more than 6 years ago | (#21598775)

I see at least one essential difference between DRM at non-competes. Where both non-competes have a limited lifetime and thus eventually will stop holding you back, DRM makes your content inaccessible for _ever_.

What about the little guy? (1)

shagymoe (261297) | more than 6 years ago | (#21599003)

I've often wondered how many times it happens that a lone programmer creates a unique application or fills a niche and gets screwed by one of his first employees taking his ideas and running with it. Imagine that he put years of thought into the structure and algorithms. Maybe the actual code wasn't extremely difficult to write, but the though process behind it was unique and the relations of his models took a significant amount of time and effort to produce. He hires a few hackers to help with final testing and the implementation and during that time, one of them was secretly writing his own version of the app. He didn't steal the code, but stole the model and the work that went into putting all of the relationships together in a cohesive way. Maybe the thief is a better programmer or has more resources and, instead of putting that talent and resources into making the original app the best it could be, he creates a better version, gets the market share and leaves the original guy in the dust. On his own, the "thief" would never have come up with the app, but once he saw the value, it was easy to steal and call it his own.

Does this happen regularly? Do you feel that it is just the "free market" at work? What did the original author do wrong? Should he have had a non-compete? If not, how does he prevent this scenario?
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