Non-Compete
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https://natlawreview.com/article/federal-trade-commission-vote-proposed-non-compete-ban-april-23
On April 16, the Federal Trade Commission (FTC) announced that it will hold a special Open Commission Meeting on Tuesday, April 23 at 2:00 p.m. ET, for purposes of voting on its proposed final rule banning non-compete agreements.
At that meeting, it is expected that the FTC will disclose the proposed final rule, Chair Lina Khan will offer brief remarks followed by a presentation by FTC staff, and then the Commission will vote whether to issue the final rule.
As we have previously covered in detail (here, here, and here) the FTC issued its Notice of Proposed Rulemaking in January 2023. The proposed rule in the form previously disclosed by the FTC for public comment would ban employers from requiring workers to sign non-competes and require recission of existing non-competes. The proposed rule would apply broadly, not just to all employees, but also to independent contractors and to any individual who works for an employer, whether paid or unpaid (e.g., externs, interns, volunteers, apprentices, or sole proprietors). It also would apply not just to non-competes that expressly prohibit a worker from seeking or accepting certain employment after the conclusion of the worker’s employment with the employer, but also to any contractual provision that functions as a de facto non-compete.
This is, potentially, a BFD for docs.
"Now look here, you Baltic gas passer... " - Mik, 6/14/08
The saying, "Lite is just one damn thing after another," is a gross understatement. The damn things overlap.
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https://natlawreview.com/article/federal-trade-commission-vote-proposed-non-compete-ban-april-23
On April 16, the Federal Trade Commission (FTC) announced that it will hold a special Open Commission Meeting on Tuesday, April 23 at 2:00 p.m. ET, for purposes of voting on its proposed final rule banning non-compete agreements.
At that meeting, it is expected that the FTC will disclose the proposed final rule, Chair Lina Khan will offer brief remarks followed by a presentation by FTC staff, and then the Commission will vote whether to issue the final rule.
As we have previously covered in detail (here, here, and here) the FTC issued its Notice of Proposed Rulemaking in January 2023. The proposed rule in the form previously disclosed by the FTC for public comment would ban employers from requiring workers to sign non-competes and require recission of existing non-competes. The proposed rule would apply broadly, not just to all employees, but also to independent contractors and to any individual who works for an employer, whether paid or unpaid (e.g., externs, interns, volunteers, apprentices, or sole proprietors). It also would apply not just to non-competes that expressly prohibit a worker from seeking or accepting certain employment after the conclusion of the worker’s employment with the employer, but also to any contractual provision that functions as a de facto non-compete.
This is, potentially, a BFD for docs.
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Interesting. A year ago I signed a non compete because there was drama with companies fighting over the same people. This would nullify my non compete, which I’m fine with. You can get paid more if the company knows you could switch easily to a competitor in the same space.
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Years ago, a friend of mine was one among many laid off from some outfit after head office in the US decided close its office here. They were given two weeks in advance and non compete forms to sign or risk being fired on the spot. There was no compensation package offered as an incentive to sign. Everyone walked off the job on the spot. No one was left to fire.
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Non-competes are generally worthless if a former employee chooses to challenge them anyway. The only time that I’ve heard of them actually standing up to a court challenge was in the case of an employee taking his client list directly to a competitor.
The Brad
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@George-K said in Non-Compete:
ban employers from requiring workers to sign non-competes and require recission of existing non-competes.
Doesn't that take a bargaining chip away from the employees?
@Copper said in Non-Compete:
@George-K said in Non-Compete:
ban employers from requiring workers to sign non-competes and require recission of existing non-competes.
Doesn't that take a bargaining chip away from the employees?
Quite the opposite.
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Non-competes are generally worthless if a former employee chooses to challenge them anyway. The only time that I’ve heard of them actually standing up to a court challenge was in the case of an employee taking his client list directly to a competitor.
Here they only work or have teeth if the non compete is accompanied by a substantial financial payout to the employee.
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There must be some way to take into account not transferring company "secrets" and strategies. NDA's or non-competes do serve a purpose.
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Trade secrets can be protected, but non-competes are very hard to craft such that they will stand up. They have to be very narrow.
@Mik Maybe trade secrets is not the right term, but I think that a person can gain a lot of company knowledge that would be very valuable to another company, even if it is not direct "quantitative" information, but more "qualitative" information.
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@Mik Maybe trade secrets is not the right term, but I think that a person can gain a lot of company knowledge that would be very valuable to another company, even if it is not direct "quantitative" information, but more "qualitative" information.
@taiwan_girl said in Non-Compete:
Maybe trade secrets is not the right term, but I think that a person can gain a lot of company knowledge that would be very valuable to another company
The situation in the medical field is quite different. The only "asset" you could probably take with you is your patient base. If you're someone without an office (radiology, pathology, anesthesiology) I don't understand why a non-compete would be justifiable, and yet, they exist.
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@taiwan_girl said in Non-Compete:
Maybe trade secrets is not the right term, but I think that a person can gain a lot of company knowledge that would be very valuable to another company
The situation in the medical field is quite different. The only "asset" you could probably take with you is your patient base. If you're someone without an office (radiology, pathology, anesthesiology) I don't understand why a non-compete would be justifiable, and yet, they exist.
@George-K In your case, who would you be signing one with?
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@George-K In your case, who would you be signing one with?
@taiwan_girl said in Non-Compete:
@George-K In your case, who would you be signing one with?
If your employer (group) had a non-compete, you'd have to find a job which is anywhere from 10-20 miles farther than your original place. Probably at least a 45 minute drive more.
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A federal judge in Texas on Wednesday partially blocked a U.S. Federal Trade Commission rule from taking effect that would ban agreements commonly signed by workers not to join their employers' rivals or launch competing businesses.
U.S. District Judge Ada Brown in Dallas said in a written decision the FTC, which enforces federal antitrust laws, lacked the power to adopt broad rules prohibiting practices that it deems unfair methods of competition. -
A federal judge in Florida has temporarily blocked a U.S. Federal Trade Commission rule that would ban agreements commonly signed by workers not to join their employers' rivals or launch competing businesses, becoming the second judge to rule that the ban is likely invalid.
