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California Lawsuit Wants To Weaken Noncompetes (axios.com)

Posted by msmash on from the moving-forward dept.

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."

4 of 125 comments (clear)

  1. one solution by ganjadude · · Score: 5, Insightful

    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.

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    1. Re:one solution by grasshoppa · · Score: 5, Interesting

      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.

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    2. Re:one solution by beelsebob · · Score: 5, Interesting

      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.

  2. Re:Voluntary Contract by barc0001 · · Score: 5, Insightful

    "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".