Non-compete contracts (from the insider)
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Pretty much all you get as in intern is "know-how", if you can't use that, then what good is it? My understanding is that in the US, you cannot sign away your ability to use your skills and experience to make a living. There are a few rare exceptions for national security reasons, but more or less, it is impossible sue (and win) an employee just because he went to work for a competitor. HOWEVER, if you take anything with you like source code, customer lists, procedures, internal memos, designs, product plans, etc., then you are opening yourself up to a WORLD of hurt. I used to work for a company and one of our best managers left to form his own company to compete with us. We were annoyed, but that's life. Then this guy starts under-bidding us by $1/hour with every one of our customers. A customer gave us a copy of the other company's contract, one look at that and we sued. When we showed OUR contract and THEIR contract to the judge, he just started laughing. You see, our contract was written by a guy with only a high school diploma (and I am guessing not exactly a 4.0 GPA). The legal language he wrote was, shall we say, "unique". To the Judge, with a real law degree and having read thousands of legal documents, it probably looked like a cartoon. The other guy stole THAT. We won the case and got a large settlement. The last I heard, the founder of the other company's car had been repossessed.
One non-compete that I know of was a friend of mine that sold his company for millions. They wanted him to know startup a new company doing the same thing and stealing all of their customers. It was only for 2 years, so he took his money, did a couple other businesses , and then when ithe non-compete expired, he contacted all of the old customers and took 80% away because they were not happy with their service for the last couple of years and knew him.
Steve Maier
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
I seriously doubt that's enforceable... You can't prevent someone from using gained knowledge... In the financial industry, particularly with traders or salesmen, you have what's known as "Garden Leave." After you've given notice or been laid-off, you spend the next 30, 60, or 90 days on garden leave before you can start another job. During that time, you're being paid your full salary (But usually no commission or bonus), but not actually working. Depending on the job, they might make you come into the office every day, but usually you're just paid to stay home. The trick is that when you're working for a trading desk, you generally know, or have a good idea of, the group's portfolio positions (Which stocks/bonds/contracts they own), so the garden leave ensures that your inside knowledge is at least X days out-of-date. That way, you can't go to a competitor and say "Well, I know they own X, Y, and Z, so let's drive down the price on those securities". It also gives them time to let all of their contacts know that you're no longer with them... Brokers, clients, other traders, etc. EDIT: As a programmer, though, I haven't been subject to this yet... Though I know of two other programmers (former coworkers) that were stuck with a clause like this.
Proud to have finally moved to the A-Ark. Which one are you in?
Author of the Guardians Saga (Sci-Fi/Fantasy novels) -
So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
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Peter Mulholland wrote:
I was the only one to refuse to sign it
Good for you. Another one that used to be common (but appears less so here in the States nowadays) is the "anything you do or discover off company hours is the property of the company." I can understand the rationale behind it, but I would absolutely refuse to sign that, preferring more honest, up-front communication if I'm doing some freelance work, obviously in totally unrelated industries. The amusing thing of course is that you can't ask a consultant to sign that. Marc
Marc Clifton wrote:
Another one that used to be common (but appears less so here in the States nowadays) is the "anything you do or discover off company hours is the property of the company."
I remember seeing that from time to time and that was an automatic deal killer with me. What I do on my own time belongs to me and no one else. ;P
"The clue train passed his station without stopping." - John Simmons / outlaw programmer "Real programmers just throw a bunch of 1s and 0s at the computer to see what sticks" - Pete O'Hanlon "Not only do you continue to babble nonsense, you can't even correctly remember the nonsense you babbled just minutes ago." - Rob Graham
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
When I left my last place they made me sign a no re-sign contract.
Henry Minute Do not read medical books! You could die of a misprint. - Mark Twain Girl: (staring) "Why do you need an icy cucumber?" “I want to report a fraud. The government is lying to us all.” I wouldn't let CG touch my Abacus! When you're wrestling a gorilla, you don't stop when you're tired, you stop when the gorilla is.
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
There was a recent court decision in California that said the language in most non-compete clauses is unenforcable. I sent a link about the decision to the HR person of the company I was working for at the time and, of course, they said and did nothing.
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
I haven't had anything similar at either of my internships. Although at my first I had to give them the right to wipe my cell phone remotely if they had reason to believe I was using it to spread company secrets. But they were a defense contractor, so it made some sense (although I did work in the branch of their company that wasn't defense related...).
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
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When I left my last place they made me sign a no re-sign contract.
Henry Minute Do not read medical books! You could die of a misprint. - Mark Twain Girl: (staring) "Why do you need an icy cucumber?" “I want to report a fraud. The government is lying to us all.” I wouldn't let CG touch my Abacus! When you're wrestling a gorilla, you don't stop when you're tired, you stop when the gorilla is.
And you still got out? :-D
Pete
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Pretty much all you get as in intern is "know-how", if you can't use that, then what good is it? My understanding is that in the US, you cannot sign away your ability to use your skills and experience to make a living. There are a few rare exceptions for national security reasons, but more or less, it is impossible sue (and win) an employee just because he went to work for a competitor. HOWEVER, if you take anything with you like source code, customer lists, procedures, internal memos, designs, product plans, etc., then you are opening yourself up to a WORLD of hurt. I used to work for a company and one of our best managers left to form his own company to compete with us. We were annoyed, but that's life. Then this guy starts under-bidding us by $1/hour with every one of our customers. A customer gave us a copy of the other company's contract, one look at that and we sued. When we showed OUR contract and THEIR contract to the judge, he just started laughing. You see, our contract was written by a guy with only a high school diploma (and I am guessing not exactly a 4.0 GPA). The legal language he wrote was, shall we say, "unique". To the Judge, with a real law degree and having read thousands of legal documents, it probably looked like a cartoon. The other guy stole THAT. We won the case and got a large settlement. The last I heard, the founder of the other company's car had been repossessed.
Roy from Detroit wrote: My understanding is that in the US, you cannot sign away your ability to use your skills and experience to make a living. There are a few rare exceptions for national security reasons, but more or less, it is impossible sue (and win) an employee just because he went to work for a competitor. That depends, IANAL - but I did retain a employment lawyer about this. What you said is true IF you are an employee, the courts won't enforce a contract that will keep you from making a living. That's the safety on the gun... protecting the "innocent" employee. HOWEVER, if you are a non-W2 contractor then the court assumes that you have retained your own lawyer (or should have) and knew precisely what you were signing and will enforce it. YMMV based on your state/disctrict/judge. In the sticks it would be laughed out of court, but don't count on it being thrown out in a metro area. -edit1- Also, they are only enforcable if signed (1) as a condition of employment or (2) as a condition of a promotion or (3) if they give you significant compensation. FWIW, -Chris C. -edit2- P.S. Notice that I left out contractors who were W2 employees of the contracting firm - that's when it varies wildly and depends a lot on the specific judge and how good each lawyer is.
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I have one in my contract. It lists 100+ companies and lasts for nine months after I leave which when combined with a three month notice period effectively puts me out of the market for a year
The shorter and more specific the restriction the more likely they could enforce it legally. Note here that it is only specific companies, which makes "1 year" reasonable. If it said any company in the ___ sector then a year might be unreasonable - it always depends on the wording + how good your lawyer is :-) Again, IANAL -Chris C.
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
It wasn't legal to begin with, which is why he let you not sign it. I went through this once, and just never signed it and they didn't notice. Later, the lawyers said that it was not enforceable.
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
I actually consulted a lawyer before signing a non-compete contract once that I found to be heinous. Here's what I learned. For ordinary software engineers, the terms of a non-compete are generally non-enforceable in the United States. A company cannot prevent you from using workaday knowledge in your next job, even if it was knowledge or experience you acquired working on their proprietary code. Many software folks in their 50s may remember having to sign a 36 page(!) non-disclosure/non-compete contract to view the AT&T Unix sources. This doc was certainly formidable, but in the end it was a waste of time. Non-competes are most likely to be enforceable on sales folk, who are the actual face of their former company to customers, and to director-level executives, who have highly sensitive strategic knowledge. Even for these folks, the litigation is not a slam-dunk, and frequently the hiring company will foot the bill for finding out. All that being said, it is always possible for your former employer to sue you. Even if they don't have a case, the suit can be a tremendous pain to litigate. It's going to come down to just how heinous your behavior was at work, and how much of a jerk your boss was. It is apparently the custom to write known-unenforceable clauses into legal contracts because they deter the hapless victim from going against the wishes of the company, no matter how unenforceable they are. The victim only discovers they are unenforceable by contacting a lawyer, a big step for most little people. It's an inexpensive legal trick for the company. It is also a litmus test for how the company treats its employees; a signal you can get before you come to work.
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
About ten years ago, my employer asked us all to sign something that promised we would seek permission for moonlighting at a second job and permission for where our spouses wanted to work. I said the first part was OK but the spousal part was not going to happen. I could not legally be asked to contract on behalf of someone else. In addition, it wanted us to promise that we would never say anything bad about the company to anyone. I said that as a licensed professional engineer there was legislation that required me to rat the company out for things like an oil spill, so I said I absolutely could not sign it. I wasn't asked again ...
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So the thread below got me looking at the insider and I clicked the "Enslaving your interns ..." link. When I was studying in college I got a part time job doing data entry in a local company. At some point they came out with this document they wanted us to sign that said we couldn't use "knowledge or know-how" gained working for them at any other company. They had programmers working for them, and I was studying software development so I could possibly have gained some "know-how" on some aspect of software development from talking to the developers. I went to the managers office and handed back the document and told him I couldn't sign it as it was too vague and all encompassing and could conceivably be used to prevent me working in any software company once i'd graduated. He said "fair enough" and I went back to work. There were a good few college students working there and as far as I know I was the only one to refuse to sign it. Anyone else had a similar experience?
Pete
I read the "enslaving your interns" link. Not enforceable. The intern was screwed by not knowing his rights, not by signing the non-compete agreement. If the scope of the non-compete is wide enough or long enough, it isn't enforceable and hasn't been since the 80's or 90s. They are trying to prevent him from earning a living and forcing him to work for them exclusively. As someone pointed out; "Restraint of Trade". I do know of a fellow who got sued by his former company when he went to work somewhere else as a sysadmin. I heard his story, told him; "It's not enforceable, just get a lawyer and countersue. If they aren't idiots they'll back down". Oddly, he did that thing and got enough money out of them to not have to worry about work for the next five years. Lucky for him since he wasn't a very competent sysadmin. Last I heard of him he was vacationing in Cape Cod before his next job. As I recall, the company that was suing him; their lawyer tried desperately to talk their CEO out of proceeding with it but he would have none of it. Bull-headed he proceeded.
_____________________________ Give a man a mug, he drinks for a day. Teach a man to mug... The difference between an ostrich and the average voter is where they stick their heads.
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Peter Mulholland wrote:
I was the only one to refuse to sign it
Good for you. Another one that used to be common (but appears less so here in the States nowadays) is the "anything you do or discover off company hours is the property of the company." I can understand the rationale behind it, but I would absolutely refuse to sign that, preferring more honest, up-front communication if I'm doing some freelance work, obviously in totally unrelated industries. The amusing thing of course is that you can't ask a consultant to sign that. Marc
Marc Your example of the "Serfdom Ownership Model" was common amongst the corporate world. Smaller independent shops might have had something similar but it was primarily because they were following the lead of the bigger corporate competitors. Both the “Non-Compete” and “We Own Anything you Do” agreements are for all intense and purpose intimidation tactics used to intimidate employees from trying to leave and go to work for a competitor, more often than not for a higher wage and or better benefits. These are simply the result of the current pro-corporate model used in the world today where the supposed desired goal of all workers is to work for the betterment of a corporation and its bottom line/stockholders and not to simply work to better the world as a whole. I don’t recall the exact details of the study although I’m sure you can find it on the internet, but a recent study found that even during good economic periods a sizeable percentage of corporate workers fear for losing their job. This fear is a plus for the corporation as it helps promote higher output from workers and discourages many from seeking wage improvements. It was a very revealing study to say the least. About the Modern Day Pro-Corporation Mentality.. In the early post-revolutionary war era, before forced public education, corporations were not allowed to operate in America without a charter which was only granted if a corporation could prove it would be providing a public service (i.e. building of roads and or canals) and even then the charter was only fir a fixed time period at which point the corporation had to once again prove it would continue to provide a public service else its charter was not6 renewed. These charters could also be revoked for violation of laws; something we today would find shocking considering how powerful the corporate world is today. Most Americans are unaware that such restrictions on corporations existed in the early years of our Republic. Perhaps your history class in public school taught this but the school I attended (19080s) did not. Slowly, the wealthy barons of the world moved to change this first by paying off politicians to get rid of the expiration date of corporate charters and to also remove the requirements that a corporation had to prove it would benefit society. I believe it was John D Rockefeller whom was instrumental in getting politicians to eliminate these restrictions on corporations. He did not want to have to prove his corporation would provide any kind of ben
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Marc Your example of the "Serfdom Ownership Model" was common amongst the corporate world. Smaller independent shops might have had something similar but it was primarily because they were following the lead of the bigger corporate competitors. Both the “Non-Compete” and “We Own Anything you Do” agreements are for all intense and purpose intimidation tactics used to intimidate employees from trying to leave and go to work for a competitor, more often than not for a higher wage and or better benefits. These are simply the result of the current pro-corporate model used in the world today where the supposed desired goal of all workers is to work for the betterment of a corporation and its bottom line/stockholders and not to simply work to better the world as a whole. I don’t recall the exact details of the study although I’m sure you can find it on the internet, but a recent study found that even during good economic periods a sizeable percentage of corporate workers fear for losing their job. This fear is a plus for the corporation as it helps promote higher output from workers and discourages many from seeking wage improvements. It was a very revealing study to say the least. About the Modern Day Pro-Corporation Mentality.. In the early post-revolutionary war era, before forced public education, corporations were not allowed to operate in America without a charter which was only granted if a corporation could prove it would be providing a public service (i.e. building of roads and or canals) and even then the charter was only fir a fixed time period at which point the corporation had to once again prove it would continue to provide a public service else its charter was not6 renewed. These charters could also be revoked for violation of laws; something we today would find shocking considering how powerful the corporate world is today. Most Americans are unaware that such restrictions on corporations existed in the early years of our Republic. Perhaps your history class in public school taught this but the school I attended (19080s) did not. Slowly, the wealthy barons of the world moved to change this first by paying off politicians to get rid of the expiration date of corporate charters and to also remove the requirements that a corporation had to prove it would benefit society. I believe it was John D Rockefeller whom was instrumental in getting politicians to eliminate these restrictions on corporations. He did not want to have to prove his corporation would provide any kind of ben
YSLGuru wrote:
You can get more details about this in a book by John Gatto,
Yes, my friend who's writing the research paper on the history of education found a wealth of information in Gatto's books. But she also discovered a bias as well as some completely unsubstantiated "facts" (if not actually incorrect facts) so it became clear that Gatto looks at the world through colored glasses of his own making.
YSLGuru wrote:
I know it sounds all science fiction like but once you check out his references and see things like the stories on the papers of that time it’s very scary to see how the whole education system came about.
The things she's discovering give me the goose bumps. Now, how in the world did you come across a post that's almost 2 months old? Well, regardless, thank you for your thoughtful reply! Marc
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YSLGuru wrote:
You can get more details about this in a book by John Gatto,
Yes, my friend who's writing the research paper on the history of education found a wealth of information in Gatto's books. But she also discovered a bias as well as some completely unsubstantiated "facts" (if not actually incorrect facts) so it became clear that Gatto looks at the world through colored glasses of his own making.
YSLGuru wrote:
I know it sounds all science fiction like but once you check out his references and see things like the stories on the papers of that time it’s very scary to see how the whole education system came about.
The things she's discovering give me the goose bumps. Now, how in the world did you come across a post that's almost 2 months old? Well, regardless, thank you for your thoughtful reply! Marc
Marc Well I came across it after 2 months because I am just now catching up on the daily CodeProject emails. I was out of work for 2 weeks with Pneumonia and the end result is it took several weeks to get to where I could look at non-work specific emails like the newsletter. If your friend doing that research has any links to info refuting John Gatto I'd love to check them out. While I have no doubt there's some bias involved since it’s impossible for one to not be biased when dealing with something they are passionate about, I also have seen evidence from other sources not connected to Gatto that effectively backup what he is saying. have you ever heard of the author and former Senior Policy Advisor (education)to the Reagan administration named Charlotte Iserbyt? She’s confirmed a lot of what Gotto says about the premise for public schooling and its real goals. I don’t believe she gets into the history of it such as who the folks were that pushed to get it started but I believe old newspaper stories from that period backup what Gotto says but I could be wrong (having misremembered). You are right about it being scary/alarming. At least people, every day average folks who in years past would say “that’s conspiracy theory” are no longer auto-replying to this and are taking the time to listen and investigate. Case in point is the whole Bilderberg group that up until the last year or 2 was always labeled as being nothing but a conspiracy theory and that there was no such meeting or group. Thanks to the internet and more importantly video, the media is no longer trying to deny there is such a meeting and that its attended by the lite. Wealthy and politicians from around the world. Granted they spin it and say it’s just a bunch of rich folks getting together to share stock tips, jokes and discuss global affairs but that no kind of policy or action is taken by those attendees when they leave. Any half-wit can see that is spin. The effort and costs to get together just a handful of these people once a year would be a major undertaking let alone a few hundred. The people who attended that meeting every year do not go to share stock tips, tell jokes and just talk.