Ask HN: Should I pass on a new job because they want me to sign a non-compete?
112 comments
Edit: hire an employment lawyer, I am not one.
That said, the way I deal with non-competes and IP in contracts is I ask them to specify the scope of the clause as it relates to the technology domains and businesses involved, for a precise amount of time (e.g. 6mos), and that they will have to pay an additional %30 of the total contract value to exercise it.
Given the three new variables, they have typically (n~=5) come back with variations on two of them. I have not been paid out on one yet, but I have had the agreement re-scoped to apply to narrow technology domains, an inclusion of the cost of the exercise option, and dropped the non-compete period from 3 years to 6 months.
Your strategy is to ensure you can afford retirement, and their boilerplate clause adds significant risk to that plan without compensation. Just say, "hey, this boilerplate section is a bit broad and it adds unncessary risk, here are some options that I would consider."
If they bully you on this, you already know everything about them you need to. However, if you're screwed and you need a job, sign it, take the money, and manage that non-compete clause risk yourself.
That said, the way I deal with non-competes and IP in contracts is I ask them to specify the scope of the clause as it relates to the technology domains and businesses involved, for a precise amount of time (e.g. 6mos), and that they will have to pay an additional %30 of the total contract value to exercise it.
Given the three new variables, they have typically (n~=5) come back with variations on two of them. I have not been paid out on one yet, but I have had the agreement re-scoped to apply to narrow technology domains, an inclusion of the cost of the exercise option, and dropped the non-compete period from 3 years to 6 months.
Your strategy is to ensure you can afford retirement, and their boilerplate clause adds significant risk to that plan without compensation. Just say, "hey, this boilerplate section is a bit broad and it adds unncessary risk, here are some options that I would consider."
If they bully you on this, you already know everything about them you need to. However, if you're screwed and you need a job, sign it, take the money, and manage that non-compete clause risk yourself.
> If they bully you on this, you already know everything about them you need to.
I have a broader question that's not very specific to non-competes.
I've held a handful of jobs with companies of varying size (from startup to thousands of employees).
I've never encountered any company that wasn't a complete and utter bully in all steps of the hiring process (and I still had to take those jobs). Simply ignoring my topics of discussion, "take it or leave it" style. At one company, they even put a lower salary in the contract than we had previously (orally) discussed.
Is that just my impression, or could you clarify what a non-bully actually looks like?
I have a broader question that's not very specific to non-competes.
I've held a handful of jobs with companies of varying size (from startup to thousands of employees).
I've never encountered any company that wasn't a complete and utter bully in all steps of the hiring process (and I still had to take those jobs). Simply ignoring my topics of discussion, "take it or leave it" style. At one company, they even put a lower salary in the contract than we had previously (orally) discussed.
Is that just my impression, or could you clarify what a non-bully actually looks like?
The tell is in your parenthesis' "(and I still had to take those jobs)" as that sounds like you entered into the discussion without any other options to start with, and they treated you like a beggar.
A discussion with a non-bully company looks like there is an ongoing discussion and uncertainty on both sides about whether the deal is going to close up to the very end, instead of agreeing from the outset and then having them stack new and unexpected conditions on the "agreement."
I respond to "take it or leave it," with, "I'm available to discuss options." Few people want to take responsibility for killing a deal, and especially people who use blunt tools like that. However, to do that, you need to always be open to the possibility that there isn't a fair deal to be had and by walking away you're lucky to have dodged the bullet.
People who expect to be rewarded for being overly agreeable get treated like dogs doing tricks for treats, and then they are surprised when they aren't treated with respect after. As though to say, "I've fetched, sat, rolled over, shaked a paw, and begged, what do you mean I can't eat from the dinner table?"
I've also "lost" job offers through negotiating, even ones I needed really badly and it seemed to friends or family like I was the asshole, but I've found that people who like you for your agreeableness don't really like you, they just like what you do for them and what felt like regret at the time was just doubt and now it is pride and confidence for having believed in myself. The terms I let the deals die over would have had long term negative trajectory for me and I knew I could do better if I kept looking. Where they saw a lost opportunity, I saw applying principles when it was hardest to do so and the stakes were high.
A big part of not being bullied is not incentivizing a situation where you can be bullied in the first place.
A discussion with a non-bully company looks like there is an ongoing discussion and uncertainty on both sides about whether the deal is going to close up to the very end, instead of agreeing from the outset and then having them stack new and unexpected conditions on the "agreement."
I respond to "take it or leave it," with, "I'm available to discuss options." Few people want to take responsibility for killing a deal, and especially people who use blunt tools like that. However, to do that, you need to always be open to the possibility that there isn't a fair deal to be had and by walking away you're lucky to have dodged the bullet.
People who expect to be rewarded for being overly agreeable get treated like dogs doing tricks for treats, and then they are surprised when they aren't treated with respect after. As though to say, "I've fetched, sat, rolled over, shaked a paw, and begged, what do you mean I can't eat from the dinner table?"
I've also "lost" job offers through negotiating, even ones I needed really badly and it seemed to friends or family like I was the asshole, but I've found that people who like you for your agreeableness don't really like you, they just like what you do for them and what felt like regret at the time was just doubt and now it is pride and confidence for having believed in myself. The terms I let the deals die over would have had long term negative trajectory for me and I knew I could do better if I kept looking. Where they saw a lost opportunity, I saw applying principles when it was hardest to do so and the stakes were high.
A big part of not being bullied is not incentivizing a situation where you can be bullied in the first place.
This is great advice. I'd say do exactly this, PLUS, accept it in the end, regardless, because non-competes are invalid in CA. (provided it's a CA job).
Thanks! I want to refine one statement in it that could trigger friction. I'd prefer to say, "hey, this boilerplate language is a bit broad and creates some risk, I think we can mitigate/reduce it by refining the language with these options." It's important to use language that treats the contract as something separate you are both collaborating together to find solutions in to make the best quality agreement. It's not a zero sum personal haggle.
I am not a fan of NVC/NLP and other types of affected behaviour, but those approaches are examples of how language is everything, and you can have a huge impact by starting with the mental exercise that the contract is an interesting problem that you are excited to collaborate to discover solutions in. The other mental exercise question to start with is, what does a high quality agreement look like? Again, if you are in a spot, just take the money, but if you have any choice or leverage at all, the returns on high quality decisions and agreements are huge.
I am not a fan of NVC/NLP and other types of affected behaviour, but those approaches are examples of how language is everything, and you can have a huge impact by starting with the mental exercise that the contract is an interesting problem that you are excited to collaborate to discover solutions in. The other mental exercise question to start with is, what does a high quality agreement look like? Again, if you are in a spot, just take the money, but if you have any choice or leverage at all, the returns on high quality decisions and agreements are huge.
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> they will have to pay an additional %30 of the total contract value to exercise it.
So if you want to join a competitor, they can prevent it by paying you 30% of your total compensation?
Seems like it would incentivize you to join a competitor at the end of the contract for an extra bonus :)
So if you want to join a competitor, they can prevent it by paying you 30% of your total compensation?
Seems like it would incentivize you to join a competitor at the end of the contract for an extra bonus :)
The idea is that the payment is compensation for the fact that you'll have to continue searching for another job for a few more months if they block you from going to a competitor.
Great if you can get it without restrictions. However, I'd expect most HR/legal minded people to want it structured similar to periodic severance payouts. That is, the 30% is paid out bi-weekly over a certain number of months, but the payments stop as soon as the person gets another job. This counteracts the perverse incentive.
Great if you can get it without restrictions. However, I'd expect most HR/legal minded people to want it structured similar to periodic severance payouts. That is, the 30% is paid out bi-weekly over a certain number of months, but the payments stop as soon as the person gets another job. This counteracts the perverse incentive.
Interesting, that scheme wasn't included, but the real value of non-competes is they reduce your leverage for comp internally within the company because your manager doesn't have to make their offers directly competitive to competitor companies because you've banned yourself from leaving for one.
If it's going to cost them %30 to keep me from going to a competitor, it means they probably won't, and I can use the competitive environment to negotiate a raise or a bonus. Of course everyone has a plan until they get punched in the face, so YMMV, but negotiations are about that equilibrium of leverage.
If it's going to cost them %30 to keep me from going to a competitor, it means they probably won't, and I can use the competitive environment to negotiate a raise or a bonus. Of course everyone has a plan until they get punched in the face, so YMMV, but negotiations are about that equilibrium of leverage.
Before"standing your ground", try negotiating first.
I've used conversations along the lines of "You're offering me this role at least partly because I have $x years experience in $relevantSubjectMatter. When, in future, we are no longer in an employment relationship for whatever reason, I will take that experience to my next employer as well. While 'm perfectly happy to sign a non-compete that limits me from taking any new experience gained while working here to any of your direct competitors (possible add "or clients"), I cannot sign a contract that prohibits me from making a living in my field of expertise after working with you. If you need me to sign a supremely broad 1 year 'will not engage in my chosen career' non-compete, we'll also need to add a 1 year's salary payout clause."
I've twice had employers pretty much say "Oh yeah, that's a standard thing we put in all contracts, but we only really apply it to salespeople. Here, let's just delete it all for your development role".
As much as anything, their response there will let you clearly know whether this is a molehill or a mountain.
I've used conversations along the lines of "You're offering me this role at least partly because I have $x years experience in $relevantSubjectMatter. When, in future, we are no longer in an employment relationship for whatever reason, I will take that experience to my next employer as well. While 'm perfectly happy to sign a non-compete that limits me from taking any new experience gained while working here to any of your direct competitors (possible add "or clients"), I cannot sign a contract that prohibits me from making a living in my field of expertise after working with you. If you need me to sign a supremely broad 1 year 'will not engage in my chosen career' non-compete, we'll also need to add a 1 year's salary payout clause."
I've twice had employers pretty much say "Oh yeah, that's a standard thing we put in all contracts, but we only really apply it to salespeople. Here, let's just delete it all for your development role".
As much as anything, their response there will let you clearly know whether this is a molehill or a mountain.
Oh, and amusing anecdote...
I accepted a gig where I used that line and got their boilerplate non-compete crossed out and replaced with just "you will not work for $majorClient or any subsidiary of theirs for 6 months", but most of my cow orkers had not done that and just signed what they were offered.
12 months later, $majorClient, who was over 80% of the billings, left. Company called an all-hands, announcing they were going into receivership and weren't making payroll for the previous month that had been due the day before. Followed somehow with am straight face by "Oh, and remember you all signed a non compete that prohibits you from working for $majorClient!".
They were somewhat unhappy when someone raised their hand and asked "So that means you'll be holding up your side of my employment contract and paying last night's salary, and all our leave and other entitlements?"
At least 6 or 8 people were back working on that project either directly at $client or at their new agency within a week.
I accepted a gig where I used that line and got their boilerplate non-compete crossed out and replaced with just "you will not work for $majorClient or any subsidiary of theirs for 6 months", but most of my cow orkers had not done that and just signed what they were offered.
12 months later, $majorClient, who was over 80% of the billings, left. Company called an all-hands, announcing they were going into receivership and weren't making payroll for the previous month that had been due the day before. Followed somehow with am straight face by "Oh, and remember you all signed a non compete that prohibits you from working for $majorClient!".
They were somewhat unhappy when someone raised their hand and asked "So that means you'll be holding up your side of my employment contract and paying last night's salary, and all our leave and other entitlements?"
At least 6 or 8 people were back working on that project either directly at $client or at their new agency within a week.
I've negotiated it from my contract before - it was a CTO role for a fashion e-commerce app. I was in the position to make use of their R&D costs and ran off with the idea.
I just brought up that the wording is too broad, and signing that would prevent me from taking any job related to e-commerce as well. So they narrowed it down to apps that utilize (fashion && e-commerce && social networking).
"any business in competition with the Company's business" is way too broad so you have to talk that through.
I also had another contract, where they were selling our expertise to the client and the client could have cut through the company and hired me directly at a quarter of the cost. It had similarly vague wording, like "not allowed to do business with any clients engaged by Company".
So I renegotiated that to "not allowed to business with Client X" because "clients engaged by Company" could mean some other client I've never met.
I just brought up that the wording is too broad, and signing that would prevent me from taking any job related to e-commerce as well. So they narrowed it down to apps that utilize (fashion && e-commerce && social networking).
"any business in competition with the Company's business" is way too broad so you have to talk that through.
I also had another contract, where they were selling our expertise to the client and the client could have cut through the company and hired me directly at a quarter of the cost. It had similarly vague wording, like "not allowed to do business with any clients engaged by Company".
So I renegotiated that to "not allowed to business with Client X" because "clients engaged by Company" could mean some other client I've never met.
> try negotiating first
Absolutely right. It's amazing what you can get if you simply have the nerve to ask for it.
Absolutely right. It's amazing what you can get if you simply have the nerve to ask for it.
The first royalty contract I was presented with meant I granted exclusive rights in exchange for a royalty. It sounded fair to me. I showed it to a friend, who said: "they have a similar product. With this contract, they get exclusive control over your product, and never have to actually sell any. You get $0 royalties, and they eliminated their competition."
If this employment contract is worth $$$ to you, it is worth showing to your lawyer.
What I also do for employment contracts, is list all my side and past projects, and get written confirmation that those remain my intellectual property. If, when I've been employed, I wanted to start a new side project, I'd get written confirmation from the company that it's mine. They've never objected, and I never had a problem. Contrast that with people who sometimes come to me saying "I've worked a year on this side project, and I'm worried my employer will claim it is theirs."
If this employment contract is worth $$$ to you, it is worth showing to your lawyer.
What I also do for employment contracts, is list all my side and past projects, and get written confirmation that those remain my intellectual property. If, when I've been employed, I wanted to start a new side project, I'd get written confirmation from the company that it's mine. They've never objected, and I never had a problem. Contrast that with people who sometimes come to me saying "I've worked a year on this side project, and I'm worried my employer will claim it is theirs."
I was shocked to learn recently that California’s exclusion of non-competes can be voided if you are represented by a lawyer when signing it!
Basically a Delaware court found that a Delaware corporation could ignore California’s provisions of an employee who had worked only in california, due to “Freedom of contract” and specifically the labor code §925(e).
In general (I’m not a lawyer) it seems wrong to me to sign something you don’t agree with, even if you think it’s not enforceable.
Here’s a reference, or just ddg “Nuvasive” which was the evil company that got this ruling.
https://www.gtlaw.com/en/insights/2018/12/california-employe...
Basically a Delaware court found that a Delaware corporation could ignore California’s provisions of an employee who had worked only in california, due to “Freedom of contract” and specifically the labor code §925(e).
In general (I’m not a lawyer) it seems wrong to me to sign something you don’t agree with, even if you think it’s not enforceable.
Here’s a reference, or just ddg “Nuvasive” which was the evil company that got this ruling.
https://www.gtlaw.com/en/insights/2018/12/california-employe...
A couple relevant facts from this case:
• the employee was a senior executive
• the contract had a “choice of law” provision that selected Delaware law instead of California
• as you mentioned, the lawyer was represented by counsel
This result was not necessitated simply by legal representation — it was also based on the choice of law provision.
I wouldn’t be surprised if the employee sued the lawyer for malpractice following this result. I haven’t practiced law in years, and I was never an employment lawyer. But I know that CA has many employee-friendly protections, and that DE is company-friendly (that’s how they get so many companies to incorporate there). The lawyer should have known about this issue and advised the client.
Based on the fact that the client brought a lawsuit over this issue, it’s clear that he was not told that he was potentially waiving CA employment protections by signing a contract with DE choice of law.
• the employee was a senior executive
• the contract had a “choice of law” provision that selected Delaware law instead of California
• as you mentioned, the lawyer was represented by counsel
This result was not necessitated simply by legal representation — it was also based on the choice of law provision.
I wouldn’t be surprised if the employee sued the lawyer for malpractice following this result. I haven’t practiced law in years, and I was never an employment lawyer. But I know that CA has many employee-friendly protections, and that DE is company-friendly (that’s how they get so many companies to incorporate there). The lawyer should have known about this issue and advised the client.
Based on the fact that the client brought a lawsuit over this issue, it’s clear that he was not told that he was potentially waiving CA employment protections by signing a contract with DE choice of law.
The interesting thing to me was that california had voided “choice of law” clauses wrt employment law, but DE determined there was a loophole in this case.
It's almost impossible to find a software job without a non-compete in Texas. It's less of a problem when it's a smaller company with a narrow focus, vs a Google that arguably "competes" with every other software company out there (this is part of why I've always opted for small companies). For example, my current company makes software for the energy sector, so I might not be able to go straight to a job at another company making software for the energy sector. I don't think it would apply to much else. To me, that seems reasonable and it doesn't really bother me.
Now, there's another type of clause that you often (but not always) run into where companies will claim ownership of everything you create while employed there (sometimes scoped to a vague "related to work", but not scoped by "on company time" or "with company equipment"). I've read horror stories about those, and I've flat-out turned down offers based on that alone. My private creative life is my lifeblood and I will not give someone the slightest bit of power over it. So I only accept if that part is missing or at least properly scoped to the hours/equipment that belong to my employer.
Sometimes smaller companies will be willing to tweak the contract if you voice your concerns; larger companies usually won't because it just gets handed down from Legal.
Best of luck.
Now, there's another type of clause that you often (but not always) run into where companies will claim ownership of everything you create while employed there (sometimes scoped to a vague "related to work", but not scoped by "on company time" or "with company equipment"). I've read horror stories about those, and I've flat-out turned down offers based on that alone. My private creative life is my lifeblood and I will not give someone the slightest bit of power over it. So I only accept if that part is missing or at least properly scoped to the hours/equipment that belong to my employer.
Sometimes smaller companies will be willing to tweak the contract if you voice your concerns; larger companies usually won't because it just gets handed down from Legal.
Best of luck.
Do you have an alternative to this agreement? Are you willing to walk if they won’t budge?
I’d suggest that you stand your ground and redline it in the employment contract. It will materially impact your future earning potential. Perhaps they can offer you a year of severance in exchange for the non compete.
They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
I’d suggest that you stand your ground and redline it in the employment contract. It will materially impact your future earning potential. Perhaps they can offer you a year of severance in exchange for the non compete.
They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
> Perhaps they can offer you a year of severance in exchange for the non compete.
Negotiating a year of severance pay is extremely unlikely without additional conditions (such as requiring 6 years of service, equivalent to 2 months severance for every 1 year of employment).
> They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
All very true. Keep in mind that their willingness and ability to be flexible varies greatly on the size of the company and how difficult it is to find other candidates with similar skill sets. If you're the only person in their hiring pipeline with a specific skillset, you might have more leverage. If they have 10 other candidates with similar talents in the hiring queue, they might simply choose to move on to the next candidate. It helps to have some leverage.
Negotiating a year of severance pay is extremely unlikely without additional conditions (such as requiring 6 years of service, equivalent to 2 months severance for every 1 year of employment).
> They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
All very true. Keep in mind that their willingness and ability to be flexible varies greatly on the size of the company and how difficult it is to find other candidates with similar skill sets. If you're the only person in their hiring pipeline with a specific skillset, you might have more leverage. If they have 10 other candidates with similar talents in the hiring queue, they might simply choose to move on to the next candidate. It helps to have some leverage.
Do you have an alternative to this agreement?
I'm not sure. I think if that more narrowly defined the scope of competition and the nature of how the relationship was terminated, maybe. I presume that the non-compete is written in such a general sense on purpose, though. To them, that's an advantage.
Are you willing to walk if they won’t budge?
I'm certainly able to, financially and otherwise. But I look for jobs infrequently, so I'm not sure how common this experience really is. Maybe I'm standing my ground here only to find out the next 10 jobs that offer have similar non-competes. If that's the case, then maybe I've made a molehill into a mountain.
They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
That's what they've said. And I've responded that, unfortunately, I won't be able to move forward.
I'm not sure. I think if that more narrowly defined the scope of competition and the nature of how the relationship was terminated, maybe. I presume that the non-compete is written in such a general sense on purpose, though. To them, that's an advantage.
Are you willing to walk if they won’t budge?
I'm certainly able to, financially and otherwise. But I look for jobs infrequently, so I'm not sure how common this experience really is. Maybe I'm standing my ground here only to find out the next 10 jobs that offer have similar non-competes. If that's the case, then maybe I've made a molehill into a mountain.
They will likely tell you “it’s standard” and “there’s nothing they can do” and they will hold that line until they know you are serious.
That's what they've said. And I've responded that, unfortunately, I won't be able to move forward.
If you, or the company, is in California go ahead and sign it. Non-competes are not valid or enforceable in the state of California.
I am not a lawyer, but when faced with a very similar situation, the lawyer I sought advice from told me this.
I am not a lawyer, but when faced with a very similar situation, the lawyer I sought advice from told me this.
> Non-competes are not valid or enforceable in the state of California.
The scope of legally valid noncompetes is narrower than California than many other places (but is not an empty set), but just because one of you or the company are in California doesn't mean that California law would be controlling when they tried to enforce this.
The scope of legally valid noncompetes is narrower than California than many other places (but is not an empty set), but just because one of you or the company are in California doesn't mean that California law would be controlling when they tried to enforce this.
This is just a quick Google, not actual research, but there is at least one employment law firm online claiming that "only California courts are able to rule on non-compete issues within the state, and the courts can only do so using California law."[0] No idea what the basis for this claim is though, and I wouldn't be able to evaluate its strength even if I did know. It's also not clear if this is relevant to a situation where not everyone involved is in California, as you point out.
Incidentally, there are some other surprisingly strong rights listed on that site, framed in such a way that suggests a law about this was enacted around 2017:
"As of January 1, 2017, non-compete agreements in California must operate under these rules:
"Employees can void any non-competes that require a court outside of California to decide disputes. In other words, the company cannot enforce an employee’s non-compete agreement in a state that allows these agreements.
"Employees are able to void contracts with illegal non-compete terms.
"Only California courts are able to rule on non-compete issues within the state, and the courts can only do so using California law.
"Employees are able to receive compensation for their attorney’s fees if they have to go to court to stand up for themselves in a non-compete dispute. Employers cannot seek attorney’s fees from the employee, even if the employer wins."
If true, this is all pretty amazing.
0. https://www.callahan-law.com/are-non-competes-enforceable-in...
Incidentally, there are some other surprisingly strong rights listed on that site, framed in such a way that suggests a law about this was enacted around 2017:
"As of January 1, 2017, non-compete agreements in California must operate under these rules:
"Employees can void any non-competes that require a court outside of California to decide disputes. In other words, the company cannot enforce an employee’s non-compete agreement in a state that allows these agreements.
"Employees are able to void contracts with illegal non-compete terms.
"Only California courts are able to rule on non-compete issues within the state, and the courts can only do so using California law.
"Employees are able to receive compensation for their attorney’s fees if they have to go to court to stand up for themselves in a non-compete dispute. Employers cannot seek attorney’s fees from the employee, even if the employer wins."
If true, this is all pretty amazing.
0. https://www.callahan-law.com/are-non-competes-enforceable-in...
I wonder if that applies to ones signed outside of California but then the signee moves.
> If you, or the company, is in California go ahead and sign it. Non-competes are not valid or enforceable in the state of California.
Making an agreement you have no intention of adhering to is not ethical, regardless of whether the law backs you up or not.
It's better to simply strike out that line and say it's not valid in California so why have it in the contract.
Making an agreement you have no intention of adhering to is not ethical, regardless of whether the law backs you up or not.
It's better to simply strike out that line and say it's not valid in California so why have it in the contract.
> > If you, or the company, is in California go ahead and sign it. Non-competes are not valid or enforceable in the state of California.
> Making an agreement you have no intention of adhering to is not ethical, regardless of whether the law backs you up or not.
Non-compete clauses are unethical. Adding non-enforceable clauses is unethical.
Both of the aforementioned points are made worse by the fact that the companies generally have more leverage + more ability to retain legal counsel, make it a lot worse, because that means that they most certainly knowingly do this.
I wouldn't even excuse myself for signing something like this while knowing of its non-enforceability.
> Making an agreement you have no intention of adhering to is not ethical, regardless of whether the law backs you up or not.
Non-compete clauses are unethical. Adding non-enforceable clauses is unethical.
Both of the aforementioned points are made worse by the fact that the companies generally have more leverage + more ability to retain legal counsel, make it a lot worse, because that means that they most certainly knowingly do this.
I wouldn't even excuse myself for signing something like this while knowing of its non-enforceability.
> Non-compete clauses are unethical. Adding non-enforceable clauses is unethical.
Neither are unethical, as neither are misrepresentations or dishonest.
There's no reason you cannot agree to terms that are unenforceable. People do it all the time. You do, too. The cost of breaking your word is not legal action, but the other party will consider you dishonorable.
> Both of the aforementioned points are made worse by the fact that the companies generally have more leverage + more ability to retain legal counsel, make it a lot worse, because that means that they most certainly knowingly do this.
If you're negotiating for a 6 figure job, you can afford $400 to have a lawyer review your contract. Keep in mind that the fact that you are offered more than minimum wage means you do have leverage.
Even if you can't afford a lawyer, you can ask on HN :-) or at least google the clauses.
Neither are unethical, as neither are misrepresentations or dishonest.
There's no reason you cannot agree to terms that are unenforceable. People do it all the time. You do, too. The cost of breaking your word is not legal action, but the other party will consider you dishonorable.
> Both of the aforementioned points are made worse by the fact that the companies generally have more leverage + more ability to retain legal counsel, make it a lot worse, because that means that they most certainly knowingly do this.
If you're negotiating for a 6 figure job, you can afford $400 to have a lawyer review your contract. Keep in mind that the fact that you are offered more than minimum wage means you do have leverage.
Even if you can't afford a lawyer, you can ask on HN :-) or at least google the clauses.
I don't know how much experience you have with dealing with companies' contracts.
If you talk to a FAANG company about this and you aren't some famous rockstar engineer, they're going to just tell you that they won't remove any clauses.
What then? Do you pass up a job offer...?
If you talk to a FAANG company about this and you aren't some famous rockstar engineer, they're going to just tell you that they won't remove any clauses.
What then? Do you pass up a job offer...?
The ones I've done contracts with were all willing to negotiate. Have you tried it?
Why is it not ethical? I would just sign it knowing that the law has you covered in case they (attempt to) take legal action against you in the future.
These companies don't care if some of their contract is enforceable -- they want you to believe it is. They almost certainly know the law and know that it isn't enforceable, but it's still there for a reason.
These companies don't care if some of their contract is enforceable -- they want you to believe it is. They almost certainly know the law and know that it isn't enforceable, but it's still there for a reason.
> Why is it not ethical?
Agreeing to something you have no intention of following through with is unethical.
> These companies don't care
It's about your ethics, not the company's. If you think the company is unethical, don't work for them.
Agreeing to something you have no intention of following through with is unethical.
> These companies don't care
It's about your ethics, not the company's. If you think the company is unethical, don't work for them.
> If you think the company is unethical, don't work for them
Why would I do that? My ethics are that companies that do unethical things deserve to have other people harm the company in some way.
That sounds like a way better way to retaliate against unethical companies. They deserve it, and it is a good thing to cause harm to groups that are doing bad things to others.
Why would I do that? My ethics are that companies that do unethical things deserve to have other people harm the company in some way.
That sounds like a way better way to retaliate against unethical companies. They deserve it, and it is a good thing to cause harm to groups that are doing bad things to others.
I don't choose to be a person like that.
Ok, and because of that, your action will cause a huge amount of harm in the world because you let bad actors get away with bad things.
My actions make the world a better place, and your actions make the world worse.
My actions make the world a better place, and your actions make the world worse.
Just to be clear, you are claiming that doing the wrong thing because someone else is also doing a wrong thing is going to make things better because "they deserve it".
Sounds like a vicious circle to me. Who is going to think that YOU "deserve it"?
Also, by choosing to work for a bad actor, you would be enabling them, purely out of a selfish motive.
People making ethical choices is one of the (many) things that make the world a better place.
Sounds like a vicious circle to me. Who is going to think that YOU "deserve it"?
Also, by choosing to work for a bad actor, you would be enabling them, purely out of a selfish motive.
People making ethical choices is one of the (many) things that make the world a better place.
> because someone else is also doing a wrong thing is going to make things better
It is ok to do wrong things against people who are doing bad things to you, yes.
The obvious example, would be you are being attacked, and you defend yourself with violence, which is normally "wrong".
> Who is going to think that YOU "deserve it"?
The other side is already engaging in these actions. Just accepting the bad actions against yourself, without a counter response, just leaves you open to being taken advantage of.
> People making ethical choices is one of the (many) things that make the world a better place.
Yes, and it is ethical to punish and retaliate against bad actors, so that they don't get away with the bad thing.
In the same way that it is ethical to defend yourself against assault, even though violence is normally wrong.
It is ok to do wrong things against people who are doing bad things to you, yes.
The obvious example, would be you are being attacked, and you defend yourself with violence, which is normally "wrong".
> Who is going to think that YOU "deserve it"?
The other side is already engaging in these actions. Just accepting the bad actions against yourself, without a counter response, just leaves you open to being taken advantage of.
> People making ethical choices is one of the (many) things that make the world a better place.
Yes, and it is ethical to punish and retaliate against bad actors, so that they don't get away with the bad thing.
In the same way that it is ethical to defend yourself against assault, even though violence is normally wrong.
> My actions make the world a better place
Reneging on your agreement only benefits you, and only in the short term. In the long term, you'll acquire a reputation that you don't keep your word, and fewer and fewer people will want to do business with you. Even worse, they won't tell you why, and you'll be wondering why you've been shut out.
More bluntly, my father told me that what separates men from animals is men have honor. Each of us gets to choose what we are.
Reneging on your agreement only benefits you, and only in the short term. In the long term, you'll acquire a reputation that you don't keep your word, and fewer and fewer people will want to do business with you. Even worse, they won't tell you why, and you'll be wondering why you've been shut out.
More bluntly, my father told me that what separates men from animals is men have honor. Each of us gets to choose what we are.
Many people buy property with racially restrictive covenants still attached to them, never intending to follow them, and knowing that those racist covenants have been unenforceable since the 1940s.
Effectively none of these people have acquired a reputation that they are not keeping their word. (Indeed, voluntarily keeping their word would be illegal under the Fair Housing Act.) Just like I don't think anyone who has signed a contract with terms that aren't legally enforceable in CA has gotten a reputation for not keeping their word.
(A rare handful of people will back out once they find such restrictions exist, or exercise the recent right in some jurisdictions to disclaim those covenants.)
It's certainly true that covenants are much harder to change than an employment contract! But so far your argument hasn't been that simply signing a contract with an unenforceable term, where you know it's unenforceable, is unethical. You haven't placed a weight on the difficulty in making a change.
Going back to your original statement:
> say it's not valid in California so why have it in the contract
People move. I always thought that if I moved from CA to TX then such clause would be binding. 'Course, I am not a lawyer. But if most people hold my opinion then again, there's no chance of reputation loss here.
Effectively none of these people have acquired a reputation that they are not keeping their word. (Indeed, voluntarily keeping their word would be illegal under the Fair Housing Act.) Just like I don't think anyone who has signed a contract with terms that aren't legally enforceable in CA has gotten a reputation for not keeping their word.
(A rare handful of people will back out once they find such restrictions exist, or exercise the recent right in some jurisdictions to disclaim those covenants.)
It's certainly true that covenants are much harder to change than an employment contract! But so far your argument hasn't been that simply signing a contract with an unenforceable term, where you know it's unenforceable, is unethical. You haven't placed a weight on the difficulty in making a change.
Going back to your original statement:
> say it's not valid in California so why have it in the contract
People move. I always thought that if I moved from CA to TX then such clause would be binding. 'Course, I am not a lawyer. But if most people hold my opinion then again, there's no chance of reputation loss here.
The racist covenant is a different situation as it is not only unenforceable, it is illegal for the owner to comply with it.
It is not illegal for the employee to adhere to the non-compete agreement.
It is not illegal for the employee to adhere to the non-compete agreement.
Then here's one which I could do voluntarily, in the present day.
One of the covenants I had to sign was that I would not run a business from home. I work from home.
I signed this knowing that it was not enforceable, because the party that could enforce it was the home owner's association which disbanded 30 years previous.
Did I renege on my agreement by signing something that I knew wasn't enforceable. I believe you think so. But did I acquire a reputation that I don't keep your word, because of that?
Not one bit. Neither did the other people in the neighborhood who ran a business from home.
Here's another: Some covenants prohibit accessory dwelling unit (ADU)s. CA Assembly Bill No. 670 made those void and unenforceable: https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml...
> Any covenant, restriction, or condition contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of any interest in a planned development, and any provision of a governing document, that either effectively prohibits or unreasonably restricts the construction or use of an accessory dwelling unit or junior accessory dwelling unit on a lot zoned for single-family residential use that meets the requirements of Section 65852.2 or 65852.22 of the Government Code, is void and unenforceable.
If I buy a house with a covenant which prohibits an ADU, knowing that that covenant is void and unenforceable, and with the intent of building a mother-in-law house in violation of that covenant, then am I being unethical? And should I gain a negative reputation for not keeping my word?
One of the covenants I had to sign was that I would not run a business from home. I work from home.
I signed this knowing that it was not enforceable, because the party that could enforce it was the home owner's association which disbanded 30 years previous.
Did I renege on my agreement by signing something that I knew wasn't enforceable. I believe you think so. But did I acquire a reputation that I don't keep your word, because of that?
Not one bit. Neither did the other people in the neighborhood who ran a business from home.
Here's another: Some covenants prohibit accessory dwelling unit (ADU)s. CA Assembly Bill No. 670 made those void and unenforceable: https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml...
> Any covenant, restriction, or condition contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of any interest in a planned development, and any provision of a governing document, that either effectively prohibits or unreasonably restricts the construction or use of an accessory dwelling unit or junior accessory dwelling unit on a lot zoned for single-family residential use that meets the requirements of Section 65852.2 or 65852.22 of the Government Code, is void and unenforceable.
If I buy a house with a covenant which prohibits an ADU, knowing that that covenant is void and unenforceable, and with the intent of building a mother-in-law house in violation of that covenant, then am I being unethical? And should I gain a negative reputation for not keeping my word?
Yes, I pointed that out.
Consider the era between when the Supreme Court said they were unenforceable, and when the Federal government made voluntary adherence illegal.
Do you think it would have been unethical for someone in the 1950s to buy a house with a racially restrictive covenant, knowing that they were not going to follow that covenant when they sold it?
If your father had known that person in the 1950s, would he have said that selling the house to a black family gives them a deserved reputation of breaking their word?
Lastly, going back to CA-specific employment law - why can't I agree that if I move to another state then I can be subject to a non-compete agreement that was in the contract when I signed it while living in CA?
Consider the era between when the Supreme Court said they were unenforceable, and when the Federal government made voluntary adherence illegal.
Do you think it would have been unethical for someone in the 1950s to buy a house with a racially restrictive covenant, knowing that they were not going to follow that covenant when they sold it?
If your father had known that person in the 1950s, would he have said that selling the house to a black family gives them a deserved reputation of breaking their word?
Lastly, going back to CA-specific employment law - why can't I agree that if I move to another state then I can be subject to a non-compete agreement that was in the contract when I signed it while living in CA?
> Do you think it would have been unethical for someone in the 1950s to buy a house with a racially restrictive covenant, knowing that they were not going to follow that covenant when they sold it?
It's a little unfair to judge a 1950s person on modern ethical standards. But I'll take a stab. You can't line out a clause in the covenant like you can in a contract. But you can 1) refuse to buy it or 2) make it clear you'll fight it in court if you need to.
As for what my father would do, I don't know. But I do know that he'd judge a man by his honor, his acceptance of responsibility for his actions, and his performance of duty to his country. He did not judge a man by his color, uniform, nationality, etc. And it cost him his career in the Air Force, so he didn't take this lightly.
It's a little unfair to judge a 1950s person on modern ethical standards. But I'll take a stab. You can't line out a clause in the covenant like you can in a contract. But you can 1) refuse to buy it or 2) make it clear you'll fight it in court if you need to.
As for what my father would do, I don't know. But I do know that he'd judge a man by his honor, his acceptance of responsibility for his actions, and his performance of duty to his country. He did not judge a man by his color, uniform, nationality, etc. And it cost him his career in the Air Force, so he didn't take this lightly.
Animals have honor and men have brains who make situational decisions.
Not playing by the rules of business is not honorable it's naive. A contract is a business agreement. If a provision isn't legal the contract usually asks that only that clause is removed enforcing the remaining contract. If something isn't enforceable in your opinion but the company is asking for it and refusing it could kill the deal it wouldn't make sense to threaten the deal over an issue you know will be resolved in your favor?
In reality companies who make you sign a non-compete will glady hire from an organzation they compete with.
If you somehow know the non-compete isn't enforceable and you don't tell them is that amoral?
Not playing by the rules of business is not honorable it's naive. A contract is a business agreement. If a provision isn't legal the contract usually asks that only that clause is removed enforcing the remaining contract. If something isn't enforceable in your opinion but the company is asking for it and refusing it could kill the deal it wouldn't make sense to threaten the deal over an issue you know will be resolved in your favor?
In reality companies who make you sign a non-compete will glady hire from an organzation they compete with.
If you somehow know the non-compete isn't enforceable and you don't tell them is that amoral?
> Not playing by the rules of business is not honorable it's naive.
Behaving ethically does not imply allowing others to treat you badly. Recall I wrote that you can simply line out that clause, and explain it is unenforceable and you won't abide by it. You are then on ethical ground. If that "kills the deal" then do you really want to work for them?
> In reality companies who make you sign a non-compete will glady hire from an organzation they compete with.
Your ethics are about you, not the other party.
> If you somehow know the non-compete isn't enforceable and you don't tell them is that amoral?
Sensible people run contracts by their own lawyer - the lawyer for the other party has a fundamental conflict of interest. If you're signing a contract for $150,000 a year, don't you agree it makes sense to drop $400 on a lawyer to check it? You'll get better advice than on HackerNews - and your lawyer will be ethically obliged to inform you about these things.
Besides, having unenforceable clauses in a contract is neither illegal nor unethical. It's just unenforceable. Not everyone needs the threat of civil court to keep their agreements.
Behaving ethically does not imply allowing others to treat you badly. Recall I wrote that you can simply line out that clause, and explain it is unenforceable and you won't abide by it. You are then on ethical ground. If that "kills the deal" then do you really want to work for them?
> In reality companies who make you sign a non-compete will glady hire from an organzation they compete with.
Your ethics are about you, not the other party.
> If you somehow know the non-compete isn't enforceable and you don't tell them is that amoral?
Sensible people run contracts by their own lawyer - the lawyer for the other party has a fundamental conflict of interest. If you're signing a contract for $150,000 a year, don't you agree it makes sense to drop $400 on a lawyer to check it? You'll get better advice than on HackerNews - and your lawyer will be ethically obliged to inform you about these things.
Besides, having unenforceable clauses in a contract is neither illegal nor unethical. It's just unenforceable. Not everyone needs the threat of civil court to keep their agreements.
The entire point of a contract is to have a document that can be brought to civil court.
If you and your employer don't feel you need one and can rely on ethics alone why sign?
I think the reason why companies want you sign one is because in the event of you leaving, companies can't enforce a word of mouth agreement in court.
Whatever is in your contract is what you agreed to but local laws might superseed your agreement. This doesn't make you amoral if you don't educate a company on local laws. This is solely the company's responsibility.
You get no hero points and your family is not better off. Telling a company their contract is not legal can be seen as a little rude and could give you a bad reputation.
If you and your employer don't feel you need one and can rely on ethics alone why sign?
I think the reason why companies want you sign one is because in the event of you leaving, companies can't enforce a word of mouth agreement in court.
Whatever is in your contract is what you agreed to but local laws might superseed your agreement. This doesn't make you amoral if you don't educate a company on local laws. This is solely the company's responsibility.
You get no hero points and your family is not better off. Telling a company their contract is not legal can be seen as a little rude and could give you a bad reputation.
> The entire point of a contract is to have a document that can be brought to civil court.
It certainly is not the entire point. The larger point is to clarify exactly what is being agreed. Memories, even among honorable people, are faulty. People can also legitimately disagree on their interpretation of conversations as they are having them. Contracts confirm to each party what was agreed to.
Nobody's memory is good enough to run a business without writing down all the agreements. And even if memories are that good, that doesn't help when you're out of the office and someone else is running it.
> Telling a company their contract is not legal can be seen as a little rude and could give you a bad reputation.
It is not rude to say "I don't agree with that term and it is unenforceable anyway so let's just line it out." It is rude to agree to something you have no intention of adhering to, and you will acquire a bad reputation for doing it.
It certainly is not the entire point. The larger point is to clarify exactly what is being agreed. Memories, even among honorable people, are faulty. People can also legitimately disagree on their interpretation of conversations as they are having them. Contracts confirm to each party what was agreed to.
Nobody's memory is good enough to run a business without writing down all the agreements. And even if memories are that good, that doesn't help when you're out of the office and someone else is running it.
> Telling a company their contract is not legal can be seen as a little rude and could give you a bad reputation.
It is not rude to say "I don't agree with that term and it is unenforceable anyway so let's just line it out." It is rude to agree to something you have no intention of adhering to, and you will acquire a bad reputation for doing it.
> In the long term
In the long term the world would be better off if companies that are doing bad things get negative consequences.
So that is good, not bad. If more people punished bad actors, it would be better.
> fewer and fewer people will want to do business
More people causing negative consequences to bad companies is a good thing though!
> Each of us gets to choose what we are
And everyone choosing to cause damage to bad actors is a good thing.
You choose to let them get away with bad actions, and the other people who actually want to make the world a better place choose to correctly cause consequences on bad actors.
The "animals" are the people who stand by and do nothing against bad actors.
In the long term the world would be better off if companies that are doing bad things get negative consequences.
So that is good, not bad. If more people punished bad actors, it would be better.
> fewer and fewer people will want to do business
More people causing negative consequences to bad companies is a good thing though!
> Each of us gets to choose what we are
And everyone choosing to cause damage to bad actors is a good thing.
You choose to let them get away with bad actions, and the other people who actually want to make the world a better place choose to correctly cause consequences on bad actors.
The "animals" are the people who stand by and do nothing against bad actors.
A father and his son were strolling down the street one day, and as they passed a woman the father tipped his hat to her. His son says, "father, why did you tip your hat to her? She's no lady, she's the town prostitute." His father says, "son, you're right. She is no lady. But I'm a gentleman."
> You choose to let them get away with bad actions
Nope. I said line it out.
> More people causing negative consequences to bad companies is a good thing though!
Behaving unethically makes you just as bad.
> You choose to let them get away with bad actions
Nope. I said line it out.
> More people causing negative consequences to bad companies is a good thing though!
Behaving unethically makes you just as bad.
Prositutes don't deserve bad things to happen to them.
Companies that screw over employees do though.
A better example would be tipping your hat to an assaulter, who mugs people. I would not respect someone who attacks others with physical violence.
> Nope. I said line it out.
And then they refuse to hire you, and hire someone else. That makes it pretty likely that they would get away with it, and screw over a different employee.
> Behaving unethically makes you just as bad.
Lets say you live in a medieval village, where there is a racist law that makes it legal for people to steal from or assault others, if they are of a certain race.
So if you see a thief, currently mugging or attacking someone, then you would be just as bad as the thief if you engaged in self defense to stop them then? Because violence is bad?
You would not only refuse to defend someone else from the thief, you would tip your hat to the assaulter! No. I a not going to respect the attacker.
Yeah no. Defending others against a thief is a good thing, not a bad thing, even if we live in some world where the attacker is not engaging in any illegal actions.
Companies that screw over employees do though.
A better example would be tipping your hat to an assaulter, who mugs people. I would not respect someone who attacks others with physical violence.
> Nope. I said line it out.
And then they refuse to hire you, and hire someone else. That makes it pretty likely that they would get away with it, and screw over a different employee.
> Behaving unethically makes you just as bad.
Lets say you live in a medieval village, where there is a racist law that makes it legal for people to steal from or assault others, if they are of a certain race.
So if you see a thief, currently mugging or attacking someone, then you would be just as bad as the thief if you engaged in self defense to stop them then? Because violence is bad?
You would not only refuse to defend someone else from the thief, you would tip your hat to the assaulter! No. I a not going to respect the attacker.
Yeah no. Defending others against a thief is a good thing, not a bad thing, even if we live in some world where the attacker is not engaging in any illegal actions.
> Prositutes don't deserve bad things to happen to them.
Again, it's not about the prostitute or what they deserve. It's about YOU.
You want to be a good guy with that clause? Line the clause out. Agreeing to something with your fingers crossed behind your back is dishonest and cowardly.
Again, it's not about the prostitute or what they deserve. It's about YOU.
You want to be a good guy with that clause? Line the clause out. Agreeing to something with your fingers crossed behind your back is dishonest and cowardly.
An agreement goes both ways.
If a company makes you sign something that it knows or should know is unenforceable, how is the company and its representatives being ethical?
If a company makes you sign something that it knows or should know is unenforceable, how is the company and its representatives being ethical?
Ethics aren't ethics if they are conditional on the other party being ethical.
Define “ethical”.
LOL. Not taking the bait.
That’s because there isn’t an ethical dilemma here, on the part of the employee.
The unethical action here is insisting on such an agreement in the first place.
Obeying or honoring an unethical agreement is what’s highly unethical; as it permits the abusive behavior.
Hence California’s law.
The unethical action here is insisting on such an agreement in the first place.
Obeying or honoring an unethical agreement is what’s highly unethical; as it permits the abusive behavior.
Hence California’s law.
> Making an agreement you have no intention of adhering to is not ethical, regardless of whether the law backs you up or not.
Yes it is. If a company is making its employees sign unethical agreements, then they deserve any negative consequence to that.
Don't make your employees sign unethical agreements, if you don't want people to lie to you, and screw you over.
Unironically, companies that do this, should be named and shamed, and everyone should take every legal option that they can get away with to screw over the company and the people who are making these decisions.
> It's better to simply strike out that line and say it's not valid in California so why have it in the contract.
Nope. Screw them over instead. They deserve it. Its legal, and they deserve to have negative consequences on them.
Yes it is. If a company is making its employees sign unethical agreements, then they deserve any negative consequence to that.
Don't make your employees sign unethical agreements, if you don't want people to lie to you, and screw you over.
Unironically, companies that do this, should be named and shamed, and everyone should take every legal option that they can get away with to screw over the company and the people who are making these decisions.
> It's better to simply strike out that line and say it's not valid in California so why have it in the contract.
Nope. Screw them over instead. They deserve it. Its legal, and they deserve to have negative consequences on them.
> Yes it is.
Nobody made you sign it. Reneging on your agreement is dishonorable.
Nobody made you sign it. Reneging on your agreement is dishonorable.
No. The text is void. The law is that you agreed to a contract equivalent to one with that text crossed out. They knew it, you knew it, they knew you knew it, you knew they knew it.
But actually do cross it out before signing, if that makes you feel any better.
But actually do cross it out before signing, if that makes you feel any better.
It's about your word, not the law.
Although the law says that clause is not enforceable, that does not mean you cannot abide by the terms.
I.e. reneging on your agreement is reneging on it, plain and simple. Signing the agreement knowing you're going to renege on it is unethical.
> But actually do cross it out before signing, if that makes you feel any better.
Man up and line it out if you aren't going to abide by it.
Although the law says that clause is not enforceable, that does not mean you cannot abide by the terms.
I.e. reneging on your agreement is reneging on it, plain and simple. Signing the agreement knowing you're going to renege on it is unethical.
> But actually do cross it out before signing, if that makes you feel any better.
Man up and line it out if you aren't going to abide by it.
Most people are signing these agreements because the alternative is not to have a roof over your head or eat.
Non-competes are for high value jobs. They're not starving.
Non-competes are being used everywhere: https://www.npr.org/2018/07/10/627682297/regulators-investig...
Non-competes are applied to fresh graduates on a regular basis, so that’s straight-out misinformation.
Fresh graduates often go into high paying jobs.
And also low paying. Those also get non-competes, because there are no downsides to forcing someone to sign.
It’s unethical.
It’s unethical.
They can also use google to answer questions about non-competes, which cost nothing. They can go to amazon and search for books "Employment Contracts" and get plenty of information. Their local public library would also be happy to help, for free.
The notion that a college graduate is a poor thing that can't discover basic information for free is ridiculous.
> It’s unethical.
Again, your ethics are about you, not somebody else.
The notion that a college graduate is a poor thing that can't discover basic information for free is ridiculous.
> It’s unethical.
Again, your ethics are about you, not somebody else.
My word is what I say to you, face to face.
Legal BS is legal BS. Putting BS terms in a contract amounts to a direct personal insult. Calling attention to a direct personal insult can be counterproductive, but signing it anyway is a way to spit on their insult, silently. Having disposed of that, you are on even terms again. You can trade unspoken insults day after day, if they like; each time you don't acknowledge one, it is one back. That is what we call business, in the modern US of A. It isn't necessary, or good, but those motivate only some Americans. They could choose to interact honorably any time they like, but they choose not to.
It is better to find circumstances where they do; but not everybody can, all the time. Nobody should need to suffer, or feel obliged to suffer, for being pinned where they cannot call out insults. Power imbalances are the norm, today. There is no possibility of free agreement, or of honor holding any meaning, under an enforced power imbalance. That should be as sad for them powerful as for us, but they never seem discomfited by it.
Legal BS is legal BS. Putting BS terms in a contract amounts to a direct personal insult. Calling attention to a direct personal insult can be counterproductive, but signing it anyway is a way to spit on their insult, silently. Having disposed of that, you are on even terms again. You can trade unspoken insults day after day, if they like; each time you don't acknowledge one, it is one back. That is what we call business, in the modern US of A. It isn't necessary, or good, but those motivate only some Americans. They could choose to interact honorably any time they like, but they choose not to.
It is better to find circumstances where they do; but not everybody can, all the time. Nobody should need to suffer, or feel obliged to suffer, for being pinned where they cannot call out insults. Power imbalances are the norm, today. There is no possibility of free agreement, or of honor holding any meaning, under an enforced power imbalance. That should be as sad for them powerful as for us, but they never seem discomfited by it.
> where they cannot call out insults
I never suggested that. I specifically said call it out, line it out, and say you don't agree.
I never suggested that. I specifically said call it out, line it out, and say you don't agree.
What? This doesn't read like English. It certainly doesn't address what I wrote.
Contracts are not oral they are based on legal agreements. They are court documents.
Non-competes have various degrees of enforceability depending on where you live and/or where the company is headquartered. I would recommend reading up on those details, but suggest consulting a qualified lawyer to verify the jurisdictional details.
The unpopular truth is that boilerplate noncompete agreements are common practice in most companies, big or small. I know people who have negotiated to not sign them, but I also know people who lost job offers by refusing to sign non-competes.
If for whatever reason you cannot expose yourself to risk of a non-compete agreement and you're willing to give up this job offer, you can try pushing back.
Practically speaking, it's rare for companies to try to enforce non-compete agreements against former employees for simply working at a competitor company. They only tend to come into play if you leave for a competing company and you're directly working to help that company compete against your former employer using knowledge or experience gained at the previous company. For example, if someone worked on XBox at Microsoft and then left for Sony to work on cameras (but not Playstation) then it's exceedingly unlikely that the company would even try to bring up the non-compete. However, if someone goes straight from the XBox team to the PlayStation team to work on the exact same feature, watch out. Even without a non-compete, the NDAs you signed could be invoked depending on the nature of this work, so not signing an NDA doesn't mean you're free and clear when moving to a competitor.
However, that's not a guarantee. If you're in a situation where you cannot afford to be burdened by any possibility of a non-compete and you're in a position to give up this job offer, you can make your employment conditional on not having to sign the non-compete.
The unpopular truth is that boilerplate noncompete agreements are common practice in most companies, big or small. I know people who have negotiated to not sign them, but I also know people who lost job offers by refusing to sign non-competes.
If for whatever reason you cannot expose yourself to risk of a non-compete agreement and you're willing to give up this job offer, you can try pushing back.
Practically speaking, it's rare for companies to try to enforce non-compete agreements against former employees for simply working at a competitor company. They only tend to come into play if you leave for a competing company and you're directly working to help that company compete against your former employer using knowledge or experience gained at the previous company. For example, if someone worked on XBox at Microsoft and then left for Sony to work on cameras (but not Playstation) then it's exceedingly unlikely that the company would even try to bring up the non-compete. However, if someone goes straight from the XBox team to the PlayStation team to work on the exact same feature, watch out. Even without a non-compete, the NDAs you signed could be invoked depending on the nature of this work, so not signing an NDA doesn't mean you're free and clear when moving to a competitor.
However, that's not a guarantee. If you're in a situation where you cannot afford to be burdened by any possibility of a non-compete and you're in a position to give up this job offer, you can make your employment conditional on not having to sign the non-compete.
> I've also heard horror stories of being presented with a non-compete to sign after starting the new job and leaving previous employment. That kind of behavior seems especially devious, but it seems pretty common as well.
It seems Texas is at-will employment and non-compete are enforceable there, which is IMHO why BS like this flies. This is luckily not common in most of the world.
> Should I pass on a new job because they want me to sign a non-compete?
You can always negotiate any part of the contract:
- Tell them you don't sign no-competes, so you can only work with them without one. Let them reject you.
- Ask for the agreement to be more strict. E.g. limit it to a sub-category, like "FX trading software".
- Ask for the agreement to be a lot shorter. E.g. 1-3 months. Note that in practical term this might be the same.
- Ask to be paid for the no-compete time. Good luck with that though.
Of course depending on the employer and how much they want/need you, they might accept the negotiation or not.
It seems Texas is at-will employment and non-compete are enforceable there, which is IMHO why BS like this flies. This is luckily not common in most of the world.
> Should I pass on a new job because they want me to sign a non-compete?
You can always negotiate any part of the contract:
- Tell them you don't sign no-competes, so you can only work with them without one. Let them reject you.
- Ask for the agreement to be more strict. E.g. limit it to a sub-category, like "FX trading software".
- Ask for the agreement to be a lot shorter. E.g. 1-3 months. Note that in practical term this might be the same.
- Ask to be paid for the no-compete time. Good luck with that though.
Of course depending on the employer and how much they want/need you, they might accept the negotiation or not.
I would guess your risk would go down substantially if you're able to just not disclose where you were going to work publicly, for a few months. (If/when you choose to leave).
"I'm looking a few options, but taking some time off first"
"I'm looking a few options, but taking some time off first"
If they find out the truth later, you'd still be in violation.
1) It depends on what your field is. For example, if you are a software engineer, moving to a company that doesn't compete is easy. If you work on software for Tesla, that doesn't mean that you can only work for car companies. So being barred from working for Ford for a year may not be a big deal. Keep that in mind. However, if you work as a mechanical engineer on electric motors, your skillset does limit you somewhat and the non-compete matters more.
2) It depends on the size of the company. At the start of my career, I worried about stuff like this a lot, to the point of trying to negotiate it. In retrospect, I'm a software engineer, so I don't really need to work for a competitor for my skillset to be useful, so I think I was wasting my time. I should have been negotiating for higher salaries instead (that's something that hiring managers can readily negotiate on and don't have to go to legal for).
3) For what it's worth, I've gone to an experienced employment lawyer several times and he's always advised me to just sign. He said that it's very unlikely to be enforced anyway and in his mind not something worth negotiating over. Keep in mind, for example, that Amazon and Google might be competitors, so going from AWS to Google Cloud might be a problem with that contract, but moving from AWS to Google Search wouldn't be since that's not a competing division.
So that's my story, but IANAL and everyone is different.
2) It depends on the size of the company. At the start of my career, I worried about stuff like this a lot, to the point of trying to negotiate it. In retrospect, I'm a software engineer, so I don't really need to work for a competitor for my skillset to be useful, so I think I was wasting my time. I should have been negotiating for higher salaries instead (that's something that hiring managers can readily negotiate on and don't have to go to legal for).
3) For what it's worth, I've gone to an experienced employment lawyer several times and he's always advised me to just sign. He said that it's very unlikely to be enforced anyway and in his mind not something worth negotiating over. Keep in mind, for example, that Amazon and Google might be competitors, so going from AWS to Google Cloud might be a problem with that contract, but moving from AWS to Google Search wouldn't be since that's not a competing division.
So that's my story, but IANAL and everyone is different.
I would try to get clarification on what does and does not constitute a competitor. The ideal would be a definitive list of competitors for which this would apply, and any future competitors would be added by mutual agreement. They might not go for that though, so it might be fine to have a sufficiently narrow definition. Of course it also depends who the company is. If it's, like, Alphabet, their competitors are going to be a broad swath of companies. For most companies though, a fair non-compete wouldn't have to restrict your options too much.
I've had a lot of contracts over the years that range from handshakes to those full of overbearing non-compete/ip clauses. Early on, I learned that handshakes aren't a good approach and you always want some form of contract that's mutually beneficial. I also started by having an attorney who answered my questions about various clauses - money well spent. Over time, I learned more and got better at negotiating - I agree with all the folks recommending negotiation. In addition to trying to get a more fair agreement, negotiation tells you more about the type of people you will have to work with. It's the first time you get to have difficult discussions and you'll learn how much you can trust them. Exception to the rule for me is that I've seen startups lately that have the overbearing non-compete/ip ownership clauses, which I just walk away from because they're so one sided that a fair negotiation isn't worth the effort when I can find other customers without having to do that. Another consideration is that I've never gone to directly work for one of my customer's competitors after working for them - unless work is hard to find, it just isn't a nice thing to do.
1 year non competes post-termination of your employment isn't all that uncommon. In practical terms, it prevents you from working for a direct competitor of your former employer for 12 months, after which it expires and you can do whatever you want.
> Anyone been pursued by a previous employer due to a non-compete?
Remember that this question is only relevant if you plan to go and work for your employer's direct competitor after your termination.
Do you anticipate working for a competitor after quitting or being fired in the following 12 months?
> Anyone been pursued by a previous employer due to a non-compete?
Remember that this question is only relevant if you plan to go and work for your employer's direct competitor after your termination.
Do you anticipate working for a competitor after quitting or being fired in the following 12 months?
Remember that this question is only relevant if you plan to go and work for your employer's direct competitor after your termination.
Do you anticipate working for a competitor after quitting or being fired in the following 12 months?
Part of the problem is that the non-compete is open-ended about who the competition is. Were it more specific or clearly defined the niche that is considered direct competition, I might have found it more palatable.
Instead, it is open-ended precisely for the purpose that it can be broadly interpreted as the Company deems appropriate.
Do you anticipate working for a competitor after quitting or being fired in the following 12 months?
Part of the problem is that the non-compete is open-ended about who the competition is. Were it more specific or clearly defined the niche that is considered direct competition, I might have found it more palatable.
Instead, it is open-ended precisely for the purpose that it can be broadly interpreted as the Company deems appropriate.
I would consider the scope what what is considered competition to be excessively broad. That must either be narrowed considerably, or they must pre-agree on what severance would be. The last time I was faced with such a non-compete, I did hire a lawyer to review and help negotiate it, and I did get it narrowed to something I could live with, and it only cost a few hundred to do so.
When the time finally came to part with that company, I was very grateful for the narrower scope.
When the time finally came to part with that company, I was very grateful for the narrower scope.
Texas government website describing the validity factors for non competes in Texas: https://www.twc.texas.gov/news/efte/conflicts_secrets_non_co...
IANAL, obviously.
1) these are not very uncommon, in my experience they're pretty normal
2) if you tell them about your friend's experience, and explain that you're willing not to work with a direct competitor but you will need to make it clear you still can seek employment as a programmer so this needs to be narrowed, they should be willing to modify the language
3) if they say "my way or the highway", even after sharing your friend's experience, that tells you something about them as a potential employer
4) but from their point of view, developers get to look at a lot of the innards of the company, and they aren't crazy or mean to want some protection from you just walking away with a lot of the value of the company in the form of IP, trade secrets, etc.
1) these are not very uncommon, in my experience they're pretty normal
2) if you tell them about your friend's experience, and explain that you're willing not to work with a direct competitor but you will need to make it clear you still can seek employment as a programmer so this needs to be narrowed, they should be willing to modify the language
3) if they say "my way or the highway", even after sharing your friend's experience, that tells you something about them as a potential employer
4) but from their point of view, developers get to look at a lot of the innards of the company, and they aren't crazy or mean to want some protection from you just walking away with a lot of the value of the company in the form of IP, trade secrets, etc.
Don't sign if you are uncomfortable with the risk. It's best to have an employment attorney look over the contract and follow their advice, but if in doubt... don't.
I once worked for a company that wanted me to sign over rights to use my name, voice, and likeness for their marketing purposes. I said no way. HR drew up a new contract with the offending clause removed.
Then there was the startup that wanted me to sign an NDA and a TEN YEAR noncompete, the penalty for violation of which was that I would be personally liable for twice my employer's market cap -- even if my employer were, say, PayPal -- just to hear what their product was.
I gave them a hard no.
I once worked for a company that wanted me to sign over rights to use my name, voice, and likeness for their marketing purposes. I said no way. HR drew up a new contract with the offending clause removed.
Then there was the startup that wanted me to sign an NDA and a TEN YEAR noncompete, the penalty for violation of which was that I would be personally liable for twice my employer's market cap -- even if my employer were, say, PayPal -- just to hear what their product was.
I gave them a hard no.
So, I am going to give a controversial take here.
Non-competes in general are not enforced. Often times they are straight up illegal, and even when they are legal, it is really pretty easy to hide where your new work is.
If you are stupid, you could get caught. But, in reality, if you actually take the correct actions, and are smart about it, the chances of you being targeted or sued is very slim.
IE, you can get away with breaking the contract. Probably because the contract is illegal, unenforceable, or unlikely to be enforced.
The important thing to do, is you just need to lie, and don't tell your former employer where your new job is. So don't put it on linkedin, ect.
Non-competes in general are not enforced. Often times they are straight up illegal, and even when they are legal, it is really pretty easy to hide where your new work is.
If you are stupid, you could get caught. But, in reality, if you actually take the correct actions, and are smart about it, the chances of you being targeted or sued is very slim.
IE, you can get away with breaking the contract. Probably because the contract is illegal, unenforceable, or unlikely to be enforced.
The important thing to do, is you just need to lie, and don't tell your former employer where your new job is. So don't put it on linkedin, ect.
In many places, noncompete clauses aren't worth the paper they are written on. In some places they are actively illegal, although DAs seem not to enforce that, much.
Now that practically all coding work is remote, you should be able to get work in some state where it would not be enforceable, even if it is, in Texas.
I don't know if it is enforceable in Texas. I know that in New York City it has been common for hedge fund coders to have enforced 6 or 12-month paid vacations between jobs. I know that California is a place where they are mostly unenforceable.
But always check with an employment lawyer.
Now that practically all coding work is remote, you should be able to get work in some state where it would not be enforceable, even if it is, in Texas.
I don't know if it is enforceable in Texas. I know that in New York City it has been common for hedge fund coders to have enforced 6 or 12-month paid vacations between jobs. I know that California is a place where they are mostly unenforceable.
But always check with an employment lawyer.
This is a tricky situation when you like the company to join and presented with these non competes. Read through the non compete and find out if the limited to a specific role within a competing company or is it a blank statement saying that you cannot join the competitor in any capacity. If it a blanket statement, I would avoid signing or work with HR to make amendments. Good luck.
This may not be relevant to your case but I don’t see it mentioned.
I have worked with several large tech companies where I did not sign the non compete. I didn’t bring it up as an issue but I very clearly didn’t sign or otherwise initial the paper work. Strangely I have never once had one of those companies come back and ask me why I didn’t sign it.
I think that companies try to get what they can out of you.
I have worked with several large tech companies where I did not sign the non compete. I didn’t bring it up as an issue but I very clearly didn’t sign or otherwise initial the paper work. Strangely I have never once had one of those companies come back and ask me why I didn’t sign it.
I think that companies try to get what they can out of you.
Another thing to consider in addition to the other comments is your position within the company. Individual contributor software engineers seem relatively safe compared to, say, a sales executive who could take a significant portion of their clients with them. Basically the more damage you could do to the company if you join a competitor, the more likely they are to come after you.
Tech recruiter here from Switzerland.
Most non-competes that I saw are invalid because they contradict with local laws.
Firms put them anyway to scare candidates. In reality, they never hold.
I made even a video about it to calm down applicants: https://www.youtube.com/watch?v=st7JaIdLJ4w
Most non-competes that I saw are invalid because they contradict with local laws.
Firms put them anyway to scare candidates. In reality, they never hold.
I made even a video about it to calm down applicants: https://www.youtube.com/watch?v=st7JaIdLJ4w
You don't say what state the job is in, or whether you're an executive level employee. Both of those are important.
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If you happen to be in California go ahead and sign it, they’ll never be able to enforce it.
Not a lawyer, but I recall hearing or reading at some point that it's actually a valid cause of action merely to be asked to sign an illegal non-compete in California. Does anyone know if that's true or I imagined that? It's academic anyhow since even if so good luck finding a lawyer to take the case since the actual damages will be miniscule.
Be transparent with your friend horror story and why you don’t want to sign the non-compete. You can also ask for a precise list.
Overall I would sign it without thinking too much of it. They probably have some horror stories from the other side!
Overall I would sign it without thinking too much of it. They probably have some horror stories from the other side!
Yes- but because you’re doubting it, not because of the non-compete.
Most contracts in-general never come into play.
But you should pay attention to all of them. Don’t sign things you aren’t comfortable with, unless you know you must.
Most contracts in-general never come into play.
But you should pay attention to all of them. Don’t sign things you aren’t comfortable with, unless you know you must.
IANAL but got a few lawyers in my circle. Unless you are a high level executive, you can just ignore non-compete. No company will or can enforce it for a low level developer.
Also advice from my lawyer friends, don't work for smaller companies with sociopath owners/executives with fragile egos. They are the one who file the most of lawsuits for no reasons. Non-compete or no non-compete clause, it doesn't matter, they are suing their employees more than bigger companies. Best defense is be a good employee and leave company on good terms.
Of course, consult your lawyer.
Also advice from my lawyer friends, don't work for smaller companies with sociopath owners/executives with fragile egos. They are the one who file the most of lawsuits for no reasons. Non-compete or no non-compete clause, it doesn't matter, they are suing their employees more than bigger companies. Best defense is be a good employee and leave company on good terms.
Of course, consult your lawyer.
Fairly standard? I dunno. Hard to uphold in certain states.
How do they control what job will you take next?
> Am I making a mountain out of a molehill or should I stand my ground?
If you can afford it, boycott this unethical job offer and move on with your life. Of course if you're anxious about paying bills in the upcoming months, that is less of an option.
Sharing information/knowledge and helping one another is the foundation of any healthy society. Someone or some corporation trying to prevent you from helping someone (whether for money or not) is definitely a sociopath and is a danger to society as a whole. They will make your life miserable and will use you to make other people's lives miserable.
If you can afford it, boycott this unethical job offer and move on with your life. Of course if you're anxious about paying bills in the upcoming months, that is less of an option.
Sharing information/knowledge and helping one another is the foundation of any healthy society. Someone or some corporation trying to prevent you from helping someone (whether for money or not) is definitely a sociopath and is a danger to society as a whole. They will make your life miserable and will use you to make other people's lives miserable.
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Seems like pretty standard language to me. Most of my jobs have had a non-compete clause similar to this one. It's obviously not great, but they're standard in states that don't forbid them. I've never been pursued.
I also tend to completely switch industry between jobs, so it would be pretty stupid for a company operating in the HFT space to sue me when I join an online sports betting company.
I also tend to completely switch industry between jobs, so it would be pretty stupid for a company operating in the HFT space to sue me when I join an online sports betting company.
You know, some HFT companies actually are also doing online sports betting.
And, you know, not all, you know, do that you know. Most you know probably don't, and you know, in my case they were doing just HFT. Sorry to disappoint.
following the termination of my relationship with the Company for any reason, whether with cause or without cause, at the option either of the Company or myself, with or without notice
...
any business in competition with the Company's business as conducted by the Company during the course of my employment with the Company
I'm not a fan of non-competes generally but considering this was written to include any business that the Company believes is a competitor (no idea what kind of scope that entails) and asserts enforcement irrespective of who terminated the employment relationship, I told them I wasn't willing to sign it.
I have a friend who was pursued by a previous employer for violating a non-compete and even though he eventually won, it cost an immense amount of money, time (18 months!), and pain to fight.
I've also heard horror stories of being presented with a non-compete to sign after starting the new job and leaving previous employment. That kind of behavior seems especially devious, but it seems pretty common as well.
Am I making a mountain out of a molehill or should I stand my ground? Anyone else found themselves in a similar situation? Anyone been pursued by a previous employer due to a non-compete?
Edit: This job is in TX.