California Lawsuit Wants To Weaken Noncompetes (axios.com)

An anonymous reader shares a report: California already prohibits companies from enforcing noncompetes within the state, but a Bay Area life sciences company is asking a state court to go even further. Veeva Systems is suing three of its East Coast-based competitors and asking a California Superior Court judge to declare that it has the right to hire employees who have signed such agreements. Veeva also wants a court to limit the use of non-disparagement and confidentiality agreements. "Non-compete agreements are bad," the company said in its suit. "These agreements limit employment opportunities. They suppress wages. They keep employees trapped in jobs they do not want, and they keep employees from fairly competing with their former employers. These agreements restrict fair and robust competition for employees."

Comments

one solution

[ganjadude]

make the company that makes you sign a non compete pay you full salary for the duration of the non compete, whether you are actually working or not.

Re:one solution

[grasshoppa]

Take this a step further, require them to report your last day of employment as the last day of the non-compete. Ie: no employment gaps on your resume.

Re:one solution

[beelsebob]

Actually, that's (not quite) the reason why non-competes are invalid in CA. The court ruled that a company wouldn't just have to pay you your full salary, but in fact would have to pay you more than your full salary during the non-compete period. The justification was that during this period you would not be keeping up with the latest technologies, and your skills would bit-rot. You'd become inherently less employable, and the company must compensate you for that.

Re:one solution

[alvinrod]

That and most people in the software industry (and I imagine many other fields) switch jobs for a pay raise. Even that alone is enough to justify asking for more than your previous salary. The fairest way to do it would do a non-compete would be for the previous company to have an option to pay whatever your next employer is offering (or something close to 100% of that amount) to not work for them for some period of time.

I think that alone makes it a fair compensation and there's nothing stopping a person from updating their skill set while they wait for the non-compete clause to expire. If you want to stay sharp, there're are plenty of open source projects to get involved in and there are plenty that are using new languages, technology, etc.

Re:Voluntary Contract

[barc0001]

"Voluntary". Let's not bullshit, in almost every job offer situation the employer making the offer has significantly more leverage than the person accepting the job and will press for concessions like a non-compete. A lot of people sign on to the non-compete because they need the job today, and can't worry about the nebulous effects of the non-compete as it may apply in the abstract future. Employers know this and take full advantage of it because once the employee is in the door, that's one more thing keeping them there even if the work environment starts to suck.

Those reasons alone are why it's not a bad idea for CA to void these "agreements".

Re:jimmy john's will cut you down to 1 hour / week

[OrangeTide]

Jimmy John's is a sandwich place that was in the news last year for making low-wage employees sign non-competes that prevented them from working at other sandwich shops within 2 miles of a Jimmy John's. And it wasn't clear if working at a restaurant that happened to serve sandwiches also count, so Jimmy John's lawyers would blast ex-employees with scary letters just in case.

Re:Just Say No

[OrangeTide]

I work in the tech industry and I'm a pretty good negotiator when it comes to payment and other terms for a new job. But I've never been able to refuse to sign a non-compete and still get the job. It is likely impossible for a new college grad to refuse a non-compete, who doesn't have nearly as much power in these situations as I do.

Now if you are a successful executive, then you have way more power and those kinds of things can be negotiated. But I assure you that at least in the Bay Area tech industry, you will find it difficult to negotiate anything like a severance package before your first day.

Now if you're being terminated anyways, you should politely refuse to sign any new paperwork. If they want you to sign something bad enough that's when the severance packages come in. Sadly I've worked at places that cut 10% of their staff to save money, and to save even more money did not give severance to a single one of them. And rather than give them a 2 weeks notice, the company was concerned about employee sabotage and gave no notice other than everyone was invited to a room full of moving boxes and security escort. That's how some of the tech industry operates in my professional experience.