New Washington state law bans noncompete agreements
119 points
1 hour ago
| 7 comments
| seattletimes.com
| HN
softwaredoug
4 minutes ago
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It’s not the noncompetes that’s the problem, it’s confidentiality agreements with extremely broad language.

Learn about the legal principle of “inevitable disclosure”. It’s the idea you can’t work for a competitor because you can’t help yourself but violate an NDA

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cyanydeez
24 seconds ago
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Inevitably, it's just the need for lawyers to intervene in "common sense" negotiations. It's never legal to do X, Y, Z, but if the business has all the lawyers and the employee has non, then it doesn't really matter whats legal; it's whose willing to exhaust the cash to fight the issue.

Which of course, is why unions are what's needed to properly negotiate employee-employer relationships, the same way a strong government is needed to negotiate corporate-civil relationships.

Americans, however, have decided that "individual freedom" is _soooooo_ valuable, that it only exists for people with enough cash to defend it.

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jeffreyrogers
9 minutes ago
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The only time I see non-competes as reasonable is when someone sells a business. It seems fair to put a territory restriction on a seller so the new owner doesn't have to immediately start competing against the person they bought out.
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NewJazz
6 minutes ago
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Isn't that doable via stay on and holdback clauses?
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mitchbob
48 minutes ago
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sheikhnbake
43 minutes ago
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Big ups for pro-working class legislation
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toomuchtodo
1 hour ago
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Analemma_
34 minutes ago
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It always baffles me how much resistance there is to banning noncompetes every time this is proposed, and how that resistance lives right alongside “we want to be the next Silicon Valley”, even though pretty much every analysis of “what’s Silicon Valley’s secret sauce” cites the unenforceability of noncompetes as one of the most important factors. But maybe the ship is turning very slowly.
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Aurornis
5 minutes ago
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Is there actually substantial resistance to this? Or just a few manufactured counter-arguments from news outlets trying to do a both-sides take on this?

Non-competes have been heavily limited or outright voided in California. That's an easy and obvious rebuttal to the Silicon Valley argument.

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toomuchtodo
4 minutes ago
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Yes. The US Chamber of Commerce is particularly noteworthy in their attempts to slow the deployment of this policy. They of course act on behalf of their members as a reputational laundering operation, so their members do not have to engage in this lobbying directly (potentially exposing them to reputational risk).

https://www.fmglaw.com/employment-law-blog-us/u-s-chamber-of...

> Less than 24 hours later, the U.S. Chamber of Commerce, Business Roundtable, the Texas Association of Business, and the Longview Chamber of Commerce filed a lawsuit against the FTC in the U.S. District Court for the Eastern District of Texas alleging that the consumer protection agency lacks the authority to issue rules that define unfair methods of competition, and instead, the FTC Act only allows it to bring cases challenging particular practices. The Chamber’s Complaint also contends that even if the FTC possessed such authority, the “noncompete rule would still be unlawful because noncompete agreements are not categorically unlawful under Section 5.” The lawsuit further argues that the rule is “impermissibly retroactive” and reflects an “arbitrary and capricious exercise” of the FTC’s power.

> The Chamber of Commerce is seeking an order “vacating and setting aside the noncompete rule in its entirety” and an order permanently enjoining the FTC from enforcing the rule. The plaintiffs are also seeking an order to delay the effective date and implementation of the noncompete ban until the conclusion of the case.

(and so, state by state enactment is the path forward until regime change can potentially speed federal enactment and enforcement of this policy)

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johnnyanmac
4 minutes ago
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There's a lot of opposition to pretty much any nigh objectively good thing for the people. Just follow the money. It usually comes down to

1. lobbyists vying for a company who wants to keep power

2. the legislature having its own vested interest from relationship/deal/lobbying

3. the minority of constituents are the ones who constantly call in and go to townhalls, because they have the time, money, or energy to do so compared to someone who's at work during a townhall.

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anon291
31 minutes ago
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Non-competes are almost always unenforceable. Never take money (although even then, they're still mostly useless), and just ignore them and no one is going to do anything. That was what my business law professor taught us. No court is going to enforce a non-compete if it means the person who cannot compete is going to be unable to support themselves. The only time it'll be enforced is if you're already independently wealthy.

In other words, a completely useless scare tactic.

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mwigdahl
25 minutes ago
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The problem is it won't get as far as trial, if the old company gets wind of it early enough (and they often do). The old company will reach out to the new company and politely inform them they believe they have grounds for a noncompete suit. The new company will either indemnify the worker, or (far more often) drop them as not worth the hassle, and take their #2 choice.

The legislation needs to change. The situation as it stands is ripe for barratry and bullying.

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smnrchrds
17 minutes ago
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You may not even get as far as an interview. More and more, I see job applications asking whether you are subject to non-competes, alongside asking about visa etc. I imagine answering yes will unceremoniously move your application to the reject pile.
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kccqzy
10 minutes ago
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It just means your start date is delayed. No different from interviewing a student whose graduation date is a year away or interviewing a foreigner who might require a few months of paperwork to get a work visa.
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ramraj07
26 minutes ago
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I know at least one person who joined a Michigan startup, moved over, got sued by non compete, and the new employer just didnt want any hassle and laid them off. This person had to leave country then.

The take home is dont take tech jobs in states where non-compete clauses are still legal.

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anon291
2 minutes ago
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Sue them back. Represent yourself. Get compensatory damages. They will lose unless you can support yourself. Do you think any state is going to let someone go on unemployment and withdraw from the public dole just because some private company wants to gain some competitive advantage. Lol

But I do agree in general, never take compensation upon leaving a company, for whatever reason. Then everything is certainly unenforceabel.

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postflopclarity
6 minutes ago
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I don't think this is quite true. in my industry & city, noncompetes are very common and commonly enforced.
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x0x0
13 minutes ago
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I lost a job because of one. In nyc. Company made some threats and the offer was pulled.
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bluGill
5 minutes ago
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You can sue the old company for that. You had a job that they are not allowing you to do. Courts don't like it when someone isn't allowed to support themselves, and so generally place narrow limits on what a non-compete tan cover. You should sue for the sake of the rest of us who might be next when this tactic is found to work.
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toomuchtodo
32 minutes ago
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People in control of orgs and capital want to telegraph thought leadership via "we want to be the next Silicon Valley" without actually giving up control of workers or making the necessary system changes. For a parallel, see how Jamie Dimon says "AI could help bring about the 4 day work week." [1] Is JPMorgan Chase trying to move to a 4 day work week? No, of course not. Jamie likes to be important and have his proclamations disseminated, not actually make the change being used to chase clout and status (because once wealthy, there is nothing left to chase if one wants to chase something).

TLDR Talk is cheap, work and change is hard and painful (broadly speaking). Observe actions, not words.

[1] https://finance.yahoo.com/news/jpmorgan-ceo-jamie-dimon-says...

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lateforwork
15 minutes ago
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The flip side should be considered as well. There should be some sort of protection for small startup companies. A big company should not be able to steal an innovative startup's technology by hiring away the employees that worked on the product. That used to happen a lot when Bill Gates was running Microsoft, for example.

Patents provide some protection, but it is flawed because a big company can put you out of business if you get into a patent war. An employee should be able to leave at any time and work for a competitor, but maybe should not do identical work, otherwise startups will have a hard time protecting their IP.

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observationist
4 minutes ago
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Companies need to put more care into who they trust, and maybe incentivize skin in the game. If leaving for a competitor means you lose equity, agency, ownership, or some intangible, that can outweigh bigger paychecks.

The market should be able to solve this problem without the government setting arbitrary rules, and people should be allowed to sign contracts that limit or restrict their freedom, so long as it involves informed consent from all parties.

If Microsoft wants to hire an AI expert for a million dollars a year, and restrict him from competing for 2 years after leaving Microsoft so as to avoid losing market advantage, that seems like a reasonable thing for Microsoft to want. If all Apple has to do to get all the Copilot secrets is hire the chief copilot engineer for 1.5 million, seems like that creates a toxic dynamic and all but guarantees acquihires and a near immediate turnaround in a startup to corporate pipeline for raiding IP.

Maybe we should be limiting businesses to doing business at a scale they can responsibly handle. If you can't get human customer service for your computer issues because Windows and Mac have scaled far beyond the number of users they could ever hope to handle, maybe that market needs regulation, and unless they scale customer service accordingly, they don't get to target a majority of the world's population as their customer base?

That'd certainly create jobs and opportunities for Linux and induce a revolution in software markets, and it'd limit the incentives for MS and Apple and big tech to do shitty things to suppress the markets overall.

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kccqzy
5 minutes ago
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This is not a mechanism to protect startups. This is a mechanism to protect the flow of ideas, whether the ideas are flowing from a big company to a startup or vice versa. Workers who find a big company bureaucratic should be able to launch a startup. Workers who find a small startup insufficiently resourceful should also join a big company to get resources.
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johnnyanmac
2 minutes ago
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[delayed]
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calvinmorrison
2 minutes ago
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acquhire practicies show that yes - sometimes people really ARE the company. However, i think for the average C# developer, or Epson printer specialist or wordpress or Bosch controller analyst, these arent really true.
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