FTC just banned non-compete agreements

[J-man]

What about those instances where a company tries implementing a non-compete and forcing existing employees to sign one to maintain their current employment? That’s exactly what happened recently at the company for which our son works. All employees were called into a company wide meeting where they had to sit thru an hour long presentation given by their newly hired legal advisor. Needless to say it didn’t go over well by the majority of the employees and after the meeting many of them let the company President know about it. I sent him the original clip from this thread, he responded that he had already heard about it and thinks his company nixed their efforts. I should mention that he loves his job and company for which he works but said he would have left had he been forced to sign a non-compete. On the surface that sounds honorable but it also demonstrates the unfair advantage the company maintains. In essence…comply or else.

 

[Boss 302]

Just because there is a non-compete, that doesn't mean it has to be enforced. In the situation you describe (group closes the practice with no other positions), the chances they would sue her are very slim. They still could, but why would they? It would cost them $$ to do so.

Here's a similar contract situation....let's say you are 18 and going to college. You take out $100K in student loans. In doing so, you signed a contract stating that you would pay back those loans. You were not forced to take those loans. You weren't even forced to go to a college that resulted in needed loans or even any college at all. Signing for those loans was a choice. Now Biden is cancelling many student loans despite the contract stating the student would pay them back. Should the govt be able to modify/void this contract also?

What if they offered a position that was a 90-minute drive from the employee's home? Noncompete clauses should exist only to prevent employees in high-tech companies from revealing information to a new employer.

 

[Boss 302]

Just because there is a non-compete, that doesn't mean it has to be enforced. In the situation you describe (group closes the practice with no other positions), the chances they would sue her are very slim. They still could, but why would they? It would cost them $$ to do so.

Here's a similar contract situation....let's say you are 18 and going to college. You take out $100K in student loans. In doing so, you signed a contract stating that you would pay back those loans. You were not forced to take those loans. You weren't even forced to go to a college that resulted in needed loans or even any college at all. Signing for those loans was a choice. Now Biden is cancelling many student loans despite the contract stating the student would pay them back. Should the govt be able to modify/void this contract also?

It would also cost the person being sued for violating the contract a lot of money to hire an attorney. All a big company has to do is file a suit against one or two employees to show all their employees that they mean to enforce the contract. The intent of non-contracts is to create a shortage of labor in specific professions to hurt the local competition. Hurt them enough to where you can buy them out and increase your footprint in the market.

 

[J-man]

I have no issue with employers expecting employees to not share confidential company information, I just don’t agree with the employment restrictions.

 

[Guard Dad]

We should remember that our Constitution extends civil rights to individuals, not groups or corporations.

I was an employer for 38 years, and even I have an issue with non-competes. Though I get the reasons behind them, I feel that they trod on individual civil rights.

No company owns their customers or employees. There will always be marketplace competition (unless the Socialists are successful) and a company has to do what is needed to remain competitive and retain their personnel.

Some years ago, a certain person who used to do marketing for P'Com found out that I had invited some of their members over to Dallas Hwy. She made a big deal on the forum that pubby owned those members and said I was stealing them by inviting them over. We all know how that worked out for them.

 

[Guard Dad]

Here's a little more on it

FTC votes to ban noncompete agreements

FTC votes to ban noncompete agreements

The Federal Trade Commission (FTC) voted 3-2 on Tuesday to ban noncompete agreements that prevent tens of millions of employees from working for competitors or starting a competing business after t…

thehill.com

 

[cptlo]

As I mentioned earlier in this thread, I'm not a fan of non-competes at all. My entire point about this is that the FTC should not be able to void millions of legally signed contracts by simply making a rule.

If non-competes are unconstitutional, fine, someone should take it to the SCOTUS and let them make a determination.

I understand all the negatives for non-competes that have been mentioned and agree. But, like with student loan contracts that people also signed voluntarily, the govt shouldn't be able to simply void and ban them.

Voluntarily signing a non-compete contract is a choice.

 

[Guard Dad]

I understand your concern about the FTC's authority in this matter. Frankly, I'm not qualified to say whether they have this authority or not, but from the language in the link below, it does appear that they may.

Regardless...I think it was the correct decision.

A Brief Overview of the Federal Trade Commission's Investigative, Law Enforcement, and Rulemaking Authority

Revised, May 2021

www.ftc.gov

 

[Boss 302]

We should remember that our Constitution extends civil rights to individuals, not groups or corporations.

I was an employer for 38 years, and even I have an issue with non-competes. Though I get the reasons behind them, I feel that they trod on individual civil rights.

No company owns their customers or employees. There will always be marketplace competition (unless the Socialists are successful) and a company has to do what is needed to remain competitive and retain their personnel.

Some years ago, a certain person who used to do marketing for P'Com found out that I had invited some of their members over to Dallas Hwy. She made a big deal on the forum that pubby owned those members and said I was stealing them by inviting them over. We all know how that worked out for them.

Another time, she came to one of the coffee get-togethers and complained that Pubby's posting of his political beliefs and insulting those who disagreed with him was causing advertisers to cancel. One of the huge problems was that he disagreed with those advertisers and called them names not knowing who they were. She complained about that stuff all the time.