Speaking of China:

The free movement of workers is important to having an efficient economy. The US could do a lot better here; we have bad safety nets, non-competes, "trade-secrets".

When workers move freely and spread trade-secrets, this results in all companies performing better, on average. This is good for everyone except the lazy owners who would lose money to those who perform better.

While the US worries about limiting the free movement of workers, non-competes, and "trade-secrets", China is going to build approximately a billion homes and factories.

Or the Brazilian law, that requires 100% compensation, and puts the onus on the company to prove that the non-compete is necessary before it can be enforced.

If you ever see one of those contracts here, it's usually usually for a very reasonable situation and a well paid position.

Oregon at least makes it 50% IIRC. Anything less than 100% seems useless though. Usually when taking a new job in the same industry you expect a pay bump, so even a 100% rate is likely leaving money on the table.

In Portugal is generically the same - non-compete clauses require the payment of a monthly compensation for the duration of the non-compete clause; If non-compete clause exists, but no specific compensation is specified in the contract, the employee may demand the full salary during the specified period (I know at least one case).

can you choose to refuse these payments to avoid the responsibility?

That actually sounds bad, since after the payments end you can basically speak about IP and its as if you're encouraged to do so after payments stop.

Imagine if Tesla had been able to stop Andrej Karpathy working at Open AI just by spending 1/3 of what his salary was when he was on Autopilot. That sounds like a terrible idea.

Then the employee is only making 30% and presumably not working elsewhere or that would defeat the purpose. So how is this a good approach? I would get 80% or more but don’t see how this is effective.

That's a terrible law.

30% of your total monthly income as it was, when you are likely leaving for more money at a competitor or to start your own company...

Would be very interested to read more about that. Do you have a link?

Australia is straight up banning non competes for anyone earning under $175k, for this reason.

They are also tightening up the contract law around non competes to reduce the impact of the scare tactics employers have been using to bind low level employees with unenforceable, but still litigable, contract terms.

And scare tactics are really all they are (in this country), because even before they do this the courts have a track record in this country of looking very dimly on overly broad or restrictive non compete 'agreements'.

Not only in the US; without going into too much detail, many countries in south America and Africa have strong business connections with the US, and it is quite common to see the ever-abusive dumb dumb US contract templates being used in those countries, even when local law differs significantly. Usually, the posture is "we can do whatever you want and you keep your mouth shut, or else we'll sue you for everything". I loathe organizations with these kind of contracts.

I'm not sure what conclusions you think we should draw from that. California's advantage over Washington is primarily one of size - Washington's GDP per capita is actually about 3% higher than California's. The most generous interpretation I can think of is that you're crediting the non-compete difference for California's far larger population, which is tenuous at best.

WA is busy losing its way on taxation vs value provided for taxes paid and reporting burden. so imo these IP issues are almost second order effects at this point. i personally expect a continued exodus over some of the latest tax hikes for example taxing cap gains beyond a certain amount at an additional 7%. as if niit was not bad enough. if residents could at least see some value from these added taxes maybe it could be something. also the estste tax there kicks in quickly and has hidden gotchas even for people who no longer live there.

One is friendly to existing wealth and the other to innovation and disruption I suppose.

Washington's non-compete laws are pretty mild these days, although it is true that it's not California.

I'm also not sure where you heard that Washington is "business friendly." B&O Tax, labor laws, Seattle city politics and the institution of income tax have all driven significant exodus from WA elsewhere over the last ten years.

But, Biden admin + WA laws in 2020 and 2024 make it a relatively low employee load for non-competes, as far as I know. Duration limited to 18 months, auto canceled if an employee is laid off, $120k-$300k income floor under which they are not enforced, details must be offered before job offer made (including a verbal job offer), no venue shifting regardless of location of employer, new employers are granted presumptive standing to sue on behalf of a new hire, agreement only allowed against current customers of the company, not enforceable when selling equity of up to 1% of a company to competitors of the company..

These are not your father's east-coast non-compete agreements! Combined with broad federal support that a non-compete cannot stop you from earning your living, e.g. banning a doctor from working for a competing healthcare system is likely no-go on its own.

I'm pro-California and anti-noncompetes, but I'm not sure if this evidence demonstrates much. The banning of non-competes in California is a very recent thing, and if we're doing a correlation thing, California saw the vast bulk of its growth when non-competes were in effect.

I suspect our primary school upbringing of “follow the rules” holds a lot of people back.

Seems like a lot of successful people in business know exactly how far they can step over the line without suffering serious consequences.

This is pretty much the advice every lawyer has given me in the past. The likelihood of it coming up is very low. Sometimes it's good to not be special.

What are the keywords for finding a lawyer who can advise on non-competes?

Asking because it turned out nearly impossible to find a local lawyer to advise on a dispute couple months ago - with 9 out of 10 telling me they only do divorces or real estate or immigration. I was literally calling one by one from a list based on what I believe were relevant search criteria on State Bar website.

I had a non-compete cause in a contract, I wound up in a dispute over unemployment insurance and the contract came up, the judge told me that the non-complete cause didn't make any sense at all but that's because it was poorly written.

What about health insurance?

In finance, it is common to be paid your base wage during your non-compete. Or at least that is how mine worked.

i personally consider bad legal clauses in employment contracts a seriously negative sign about the employer. if they’re trying to pull that sort of thing at hiring, what are they going to try to do later when you’re fully committed?? is executive leadership simply unaware or do they condone that sort of thing??

The fact that something isn't enforceable does not mean it won't be a giant headache to prove it in a court in a foreign country.

There's option 3, and that's: don't say anything, strike some passages and sign it.

Whether that's a good idea, that depends on the circumstances but I'm just noting it as an option.

Having probably signed such a contract, how do I find out if it is enforcable? Probably talk to a lawyer, but how do you find one that gives you a straight, but correct, answer to such a complex topic. For me it is even more complex since I'm a fake employee (contractor) in another country working for a US company.

The answer to those questions might be really unsatisfying in practice, since it breaks down to a cost calculation by the sueing company (if the company leadership is rational). So in case you get sued you have to fight defensively and bleed them enough so they give up or something.

> adding anything that prevents you from finding work in the future to a contract is kind of invalid.

Here it's six months top, and it only applies to management and specialists with critical domain knowledge - and this also has to be reflected in their wage.

That is exactly what I'm wondering about. At least a few states have severely limited noncompetes and even outright banned them in specific contexts. I have to wonder if a nondisclosure twisted for use as a noncompete would survive the courts in one of those states.

I'm also skeptical how enforceable this theory is in general. Have there been any noteworthy cases of employees getting screwed over that rested on it?

Just looking this up but appears NY finally caught up here in 2023 https://newyork.public.law/laws/n.y._labor_law_section_203-f

I usually add this at the end of the agreement and if they wont go for it, I move on:

This agreement shall not apply to any inventions, conceptions, discoveries, improvements, and original works of authorship that [my name] developed entirely on their own time without using [the employer](s) equipment, supplies, facilities, trade secret information, or anything not based on or received from [the employer].

It also depends on the laws governing your contract, not just where you live.

Right, as in "I literally cannot comply with this"? Makes sense.

If you’re an employee under NDA, and your company considers almost everything about your work to be confidential, you can’t effectively paint a detailed picture for the role.

The NDA gives them some protection to answer your questions openly and transparently.

> Sure, some things (like taking customer lists when you leave a company) are messed up and should be barred

Is it messed up? If you're a salesperson, and you've built the relationships with these customers is their loyalty to you, or to the company that you worked for? I had a personal trainer for a little while and he took all his clients to a new gym when he decided to contract with a different gym.

I don't know the answer to this. But it doesn't seem as clear cut to me.

    > some companies require NDA just for interviews

IF you go to an interview, and nothing was divulged to you, this NDA does not mean anything. But if youwork at a competitor, and you get an interviewer tell you things that the company does not want to divulge, company has some protection. Not all laws and processes are bad.

Realistically, most places ban ‘unconscionable’ contract clauses, either explicitly or by making them unenforceable.

At least in theory, any judge that saw clauses like that should throw it out for that reason alone in those jurisdictions.

Yeah, good luck being the odd one out who wants special individualized contract. This might work for unicorn value level employees that are poached from one FANG to another but not for the average Joe.

ianal but: don't perform personal work while you are employed by an employer in the same industry. Or at least make it like you didn't do that to any observer.

Civil law jurisdictions also have protections against one-sided contracts.

IANAL and I don't know about other countries, but in EU (definitely the country I live in and am pretty sure it goes for the rest as well) any non-compete agreement after two years is void by law.

You are required to hold confidential stuff for life, like business contracts, but you can use your know-how, if it does not violate any patents, in a competing company as you see fit. This knowledge is a part of you and cannot hold you against employment. Even if you do decide within those two years to employ yourself in competing company, this can be held back by your original company only if they give you X% of your pay at them (X can be 80, or as low as 50, as my friends inform me).

To riff Keynes,

Enforcement can maintain litigation longer than you can maintain solvency.

So far it seems maybe?, but according to the article some courts and agencies are pushing back. Well the FTC was at least in 2023.

California bans anything that is effectively a non compete.

I understand that your advice is in good faith - but if we touch grass for a second, only the tiniest fraction of even professional workers have a lawyer at hand. And one that specializes in contract law? Even less.

> your lawyer

That presupposes that people have a lawyer, and one specialized in employment law at that, which is highly unlikely to be the case for 99% of the population.

This implies that any employee at Coca Cola knows and has access to the secret formula, which is of course, not true. And even if it were true, there's a substantial difference between a specific, limited piece of information (such as the recipe for Coca Cola) and broad concepts about operating in an industry.

I work in the Robotics industry. While the algorithm for our path planning would be a trade secret, how path planning is pursued is not. It's a fundamental concept in robotics. To extend the metaphor, it would be as if my company thought that any robotics work that involved path planning would violate their IP, because I did path planning work with them. It's nuanced to be sure, but some companies are very aggressive as to prevent you from having mobility in your career. Sometimes in a genuine effort to protect their IP, but also sometimes to reduce your negotiating power or punish you.

There is a difference between trade secrets and non compete. If you can compete with the company without using trade secrets, like make a drink that people like without using Coca Cola secret, it is fine.

as far as i can tell there are a million sodas that are extremely close to coca cola and coca cola is still doing just fine

why downvote this? I have gone through this route and can vouch this is for a good cause, this conversation may mislead people into believing stealing is okay.