this post was submitted on 23 Apr 2024
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The Federal Trade Commission narrowly voted Tuesday to ban nearly all noncompetes, employment agreements that typically prevent workers from joining competing businesses or launching ones of their own.

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[–] [email protected] 35 points 6 months ago

Damn, Lina Khan has been killing it lately.

[–] [email protected] 61 points 6 months ago* (last edited 6 months ago) (9 children)

This sounds awesome, but I will say that I'm a bit concerned about whether or not the Supreme Court will let this stand. I'm speculating that the Supreme Court may strike it down and say that the FTC doesn't have jurisdiction and that non-compete clauses should be handled by the Department of Labor or something like that. Imo it could fall under either department because the FTC is meant to tackle anti-trust measures, and non-compete clauses could be seen as a form of monopolistic behavior (restricting competition).

At the same time, however, non-competes have to do with labor practices, which is why I could see the Supreme Court saying that it's something the DoL should enforce, and because (afaik at least) the DoL only has the power to enforce legislative regulation, we'd end up back where we started: waiting for Congress to get their shit together and actually do something instead of sitting around and picking fights or virtue signalling.

I hope I'm wrong though. I'd like it if our Supreme Court would let us have nice things every now and then.

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[–] [email protected] 11 points 6 months ago

This is amazing! I’ve always had to be under a noncompete even though no one gives a shit about my work. So while no one would probably ever enforce it, I was always worried when switching jobs and now I don’t have to.

[–] [email protected] 24 points 6 months ago (9 children)

Is this what they make you sign that says

"You can't join any company that is in the same industry or has the same customers for 2 years after leaving the present company"

?

[–] [email protected] 3 points 6 months ago

Or sometimes, like mine, that you can't quit your contract early to apply for a full colleague position at the company you're being contracted out to.

[–] [email protected] 14 points 6 months ago
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[–] [email protected] 36 points 6 months ago (3 children)

I always thought non-competes were total bullshit anyways. Like a scare tactic or something. And unenforceable.

Didn't matter and sure doesn't now.

[–] [email protected] 21 points 6 months ago (1 children)

I had a non-compete handed to me when I lived in California. I laughed my ass off and signed it. When I left the dumbass VP of HR threatened me with it.

My response was "Could you pretty please try to enforce it? My lawyer would absolutely love to represent me in court. FYI you know my lawyer. He was the paralegal that told you the non-compete contract wasn't legal. You then screwed him over and got him laid him off. Guess who passed the bar exam 6 months ago!"

[–] [email protected] 17 points 6 months ago

For those not familiar and missing context, California prohibited noncompetes prior to the federal prohibition.

[–] [email protected] 29 points 6 months ago (1 children)

They probably were, but to find out you'd have to go to court, and your average person doesn't want to do that.

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[–] [email protected] 10 points 6 months ago* (last edited 6 months ago) (1 children)

Fuck yes let's go! I am pumped.

*So what's the historical use of these? I can only assume in the past it was used sparingly, then went further and further until the current state of "fuck you employees".

[–] [email protected] 1 points 6 months ago (1 children)

I asked my dad about it. He said they've been around ever since he started taking salaried positions (which would mean roughly since the 70s~80s)

[–] [email protected] 1 points 6 months ago

It's not whether or not they've been around, it's how they've been used, how often they've been used, for what positions they've been used, how severely they've been used. Etc.

[–] [email protected] 24 points 6 months ago* (last edited 6 months ago) (5 children)

Would this also apply to a contracting agency that has a noncompete document that had to be signed by their contractor employees?

The noncompete is so that the contracting employee can't end the contract early and then be hired directly by the company they were being contracted to. At least not for at least a year after ending the contract unless the length of the contract was completed in full.

Edited for clarity

[–] [email protected] 15 points 6 months ago (1 children)

I think so, yes. If you read the actual rule (https://www.ftc.gov/system/files/ftc_gov/pdf/noncompete-rule.pdf) it says a noncompete is something against "seeking or accepting work in the United States with a different person". Since you're working in the first part with a contracting agency, and then going to work with a different company, the rule seems applicable here.

I'm not sure why they use "person", but I'm assuming your W-2 or 1099 would have different companies, and the different companies would have different presidents/CEOs/chairmen, so it would objectively be different both in the general legal Romney-style "corporations are people" person and the literal dictionary person.

[–] [email protected] 2 points 6 months ago

I’m not sure why they use “person”, but I’m assuming your W-2 or 1099 would have different companies

Yes, those documents list the contracting agency as the company one is working for, rather than the company one is being contracted out to.

[–] [email protected] 9 points 6 months ago (1 children)

That's exactly what a non-compete is. Your job can no longer stop you from quitting and working for a competitor.

[–] [email protected] 3 points 6 months ago (5 children)

Not a competitor, but the company you were working at with the contracting agency. Basically trying to stop being a contractor and trying to be hired directly as a colleague.

[–] [email protected] 1 points 6 months ago

I'm not a lawyer, but I'd imagine that would also be banned. You'll have to see if you get a notice from the agency

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[–] [email protected] 3 points 6 months ago (1 children)

That's a good question (but you might want to rephrase it to something clearer).

[–] [email protected] 3 points 6 months ago (2 children)

I think he's asking about temp to hire, the employee being given an offer, but only if they quit and quit looking through the temp to hire agency, then get picked up by the company they were working for (before the 1 year that the temp to hire would be collecting commission on)

But I don't have the foggiest what the answer would be

[–] [email protected] 2 points 6 months ago* (last edited 6 months ago) (1 children)

Basically yes but I get the impression he means more than labor or basic admin, which I'm not too familiar with. For the basic stuff I believe the company pays the temp agency a small fee. From what I've seen the temp agency doesn't really care about retaining people so they just roll with it.

[–] [email protected] 1 points 6 months ago

Basically a lot of the low level jobs are contractors. And you can eventually be hired by the company as a colleague once your contract is up. The contracting agency, however, put in a noncompete clause so that the contractors can't end their contract early in order to apply for that company's colleague position.

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[–] [email protected] 86 points 6 months ago (10 children)

I remember my last job had a Non compete. I was a handy man. Non competes for NBA players and wealthy CEOs, fine. But non compete for just regular people doing regular jobs is crazy. Once I leave my current job, my ex employer should have no say in where I work afterwards.

[–] [email protected] 4 points 6 months ago (1 children)

Canadian here. I had one for working in a call centre ffs. And afaik we don't have laws against it. :(

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[–] [email protected] 32 points 6 months ago

That's just so they can treat you like crap and under pay you, so that you can't just go be a handy many somewhere else. If you lived in California it would have already been unenforceable anyway though.

[–] [email protected] 7 points 6 months ago

And if your employer doesn’t want you working elsewhere, they should put you on garden leave.

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[–] [email protected] 192 points 6 months ago (7 children)

Is this as big as it sounds? It sounds big.

[–] [email protected] 5 points 6 months ago

Yes big deal. However, I'm not sure if this will survive the supreme court.

[–] [email protected] 8 points 6 months ago* (last edited 6 months ago) (1 children)

Is this a big deal in terms of allowing people to more easily quit their jobs and take new ones? Yes.

Is this a big deal in terms of boosting innovation and economic productivity by allowing ideas to move more freely between businesses? Maybe.

Is this a big deal in terms of harming businesses or causing radical shakeups at businesses? No. States like California already ban non competes as do most western countries, companies just keep on going, truly proprietary innovations are already going to be covered by NDAs.

[–] [email protected] 7 points 6 months ago

Is this a big deal in terms of allowing people to more easily quit their jobs and take new ones?

Now do healthcare.

[–] [email protected] 51 points 6 months ago (1 children)

100%. These non-competes essentially lock employees in to their existing employer, unless they want to find a job in a completely unrelated sector (and likely take a massive payout, which, especially these days, is near financial suicide). This will have enormous ramifications for companies with toxic culture, as now people don't have to put up with their crap. This allows for freedom of economic mobility, and more control of one's own life.

[–] [email protected] 10 points 6 months ago (2 children)

I’m going to go against the crowd and say that while I think it’s a good move to make it official non competes were effectively already declared unenforceable via the court system. It’s rarely used for the average worker unless something truly fucky was going on and the courts would usually side with the employee no matter what unless something truly fucky was going on.

[–] [email protected] 30 points 6 months ago (1 children)

Even if unenforceable, they likely had a huge chilling effect. Most people understandably prefer not risking going to court, even if they're in the right.

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[–] [email protected] 127 points 6 months ago (2 children)

18% of all working people in the US are under non-competes. This is a huge deal.

[–] [email protected] 34 points 6 months ago (1 children)

I honestly assumed the number/percentage was higher

[–] [email protected] 32 points 6 months ago (3 children)

Yeah, even hotel housekeepers sign papers saying they cannot quit and go to work for competitors these days.

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