Non-competes for blue collar jobs

[MillCreek]

http://www.seattletimes.com/nwshowcase/careers/noncompete-agreements-spread-cutting-off-the-right-to-a-new-job/

We use non-compete agreements frequently with healthcare providers, and Washington state law upholds them.  Some of the large healthcare systems in Seattle are enthusiastic about suing providers who breach them.  I know they are also common in the dot-com industry up here.  I had never heard of a non-compete for blue collar jobs.

[mtnbkr]

Non-competes are evil.  Between things like that and the increasing offshoring of work, I'm starting to wonder if white-collar unions may be a solution. 

Chris

[Hawkmoon]

Non-competes are evil.  Between things like that and the increasing offshoring of work, I'm starting to wonder if white-collar unions may be a solution.  

Chris

Agreed. Protection of trade secrets and proprietary information is one thing, but that's a non-disclosure agreement, not a non-compete agreement. There's nothing special about drilling holes in the ground or cutting down trees. Using non-compete agreements for jobs like that is basically a legal trick to turn workers into indentured servants.

[Jocassee]

Non-competes are evil.  Between things like that and the increasing offshoring of work, I'm starting to wonder if white-collar unions may be a solution. 

Chris

It's occurred to me. To me this just more evidence of the rank stupidity in corporate America. This doesn't happen by accident. You have to work to be this stupid.

[RevDisk]

Non-competes are evil.  Between things like that and the increasing offshoring of work, I'm starting to wonder if white-collar unions may be a solution.  

Chris

Non-competes are absolutely evil unless you are compensated for the entire duration of the non-compete. Asking lowly or even moderately people to become indentured servants via complicated legal documents isn't unethical, it's flat out evil. If you're making six figures, it's a complicated but understandable part of the game. I've heard of it starting to be done to mid level programmers and engineers. People making ok but not stellar money. Which is really hard to turn down if an entire industry acts in an anti-competition cartel.

I certainly would never sign one unless it was exceedingly narrow in scope and had appropriate compensation.

This is one of those areas where California actually has a better leg up. Anti-competes are pretty limited there. It makes sure talent can move to where they are most economically beneficial (ie highest paid) and not be chained down to a single job.


MillCreek, actual serious question. What happens if you clearly sign or print "I do not agree" or whatnot in the signature block? Separate question. What if you alter a standard form? HR types often do not read them. My natural assumption is Ultima Ratio Regum, highly paid lawyers crush you regardless of the law. But what's the industry feel? For a hypothetical, you are asked to sign a non-compete with no compensation, so you sign it as "I do not agree" and their HR department never looks at it, but employs you anyways. Or you clearly edit it to say "This agreement is invalid immediately by consent of both parties."

[KD5NRH]

Non-competes are absolutely evil unless you are compensated for the entire duration of the non-compete.

This, especially when they're overly vague (covering pretty much every aspect of a field of work) or otherwise too broad (prohibiting working in any capacity for any client or vendor to the employer, who provides - or worse, has an effective monopoly on - a common good or service in the area, like a phone provider) to allow the employee to find reasonable work.  I've walked away from more than one job because of a noncompete that would have essentially left me completely unemployable for six months after leaving there, and had no provision for layoff or anything else.  One that comes to mind was an ISP at a time when there were only three major ones in a 50 mile radius, and the noncompete had the "in any capacity for any current or former client" language in there, which would have eliminated roughly 40% of the employers within a 90 minute drive as current clients, (and more than a few beyond that, since they offered other services all over Texas) and likely nearly all as former clients.

[K Frame]

I turned down a job about 10 years ago when they required me to sign a non-compete, even if they laid ME off for contact reduction or loss.

Said I'd be more than happy to sign a non-disclosure, they said no.

I said "Do the letters F.O. mean anything to you?"

Well, I actually said "You must be out of your mind" or something similar. No way was I going to sign a document that would prevent me from earning a living within 300 miles of DC metro for 5 years.

The guy looked at me, I looked back at him, snorted, grabbed my crap and walked out.

[MillCreek]

MillCreek, actual serious question. What happens if you clearly sign or print "I do not agree" or whatnot in the signature block? Separate question. What if you alter a standard form? HR types often do not read them. My natural assumption is Ultima Ratio Regum, highly paid lawyers crush you regardless of the law. But what's the industry feel? For a hypothetical, you are asked to sign a non-compete with no compensation, so you sign it as "I do not agree" and their HR department never looks at it, but employs you anyways. Or you clearly edit it to say "This agreement is invalid immediately by consent of both parties."

That would probably be a pretty classic contract law question.  Generally speaking, a modification or amendment of a contract is only valid if it is agreed to by both parties.  You would want to show that both parties agree by a writing, such as both parties initialing the modification or amendment or explicitly stating that the modification or amendment is agreed to and incorporated into the contract.  Something like you described would probably be treated as a unilateral mistake and would not necessarily render the contract void.  However, there are probably several linear feet of appellate court opinions in that jurisdiction on how to treat mistakes in contract, and it would depend entirely on the statutory/case law of a given jurisdiction as to how this matter would be handled.  A lot of time would be devoted into looking into your intent in making that change and did you have 'unclean hands' in doing so.

[MikeB]

Maybe WA State is different, but when I had to sign a non compete a number of years ago I spoke to a Lawyer that assured me outside a very narrow scope the agreement would be largely unenforceable. That scope being that it had a limited duration and was not applicable if I was let go without good cause. He also said even if they tried to enforce it within the narrow scope they would have to show that my new work was actually competing and they would have a narrow definition. YMMV. This was in PA. He also advised the compensation for signing it wasn't worth losing. This involved the sale of a company and was actually two agreements one non compete and one retention. I basically got about two years salary for agreeing to stay for one year and then agree to non compete if I left voluntarily for either two or three years.

[zahc]

NCA's aren't stupid from the company point of view. Why wouldn't you want to improve retention, keep wages low, and prevent your competitors from poaching your talent? There's practically no downside, which is why they are gaining popularity everywhere they are allowed.

NCAs are, of course, anti-competitive by nature, they should be banned outright like any common price-fixing racket. California​ is the only state I know that bans them; I can't imagine why it's not a more popular stance given it seems like an easy small-guy-vs-evilcorp sell. Probably because the politicians actually work for evilcorp.

[Scout26]

They are practically non-enforceable here in Illinois  (Unless they you offer two years or more of "consideration".) 

Even Illinois courts have somewhat frowned on DO's, unless it was your intent to steal trade secrets.  The company that bought OCP tried to go after several of us because of the non-compete.  I sent them a letter that said "Warehousing and Distribution is Warehousing and Distribution.  I can send you a current customer list of the company I work for, but none are anything like what OCP did."

Never heard back from them.  It wasn't even from their lawyer(s), some HR flunkie sent it.  Not sure what they were trying to gain....

[230RN]

When a noncompete agreement is litigated to the letter, a worker can be barred or ousted from a new job by court order. Even if that never happens, the threat alone can create a chilling effect that reduces wages throughout the workforce.

Aha! Terry said, smirking to himself. 

I didn’t have to attorney-up and fight the thing,” said Hill, who settled the case out of court. “It’s ridiculous — it’s slavery in the modern-day form.”

The whole thing would seem to put a sharp point on the difference between "The Law" and "Justice."

Terry, 230RN

[De Selby]

That would probably be a pretty classic contract law question.  Generally speaking, a modification or amendment of a contract is only valid if it is agreed to by both parties.  You would want to show that both parties agree by a writing, such as both parties initialing the modification or amendment or explicitly stating that the modification or amendment is agreed to and incorporated into the contract.  Something like you described would probably be treated as a unilateral mistake and would not necessarily render the contract void.  However, there are probably several linear feet of appellate court opinions in that jurisdiction on how to treat mistakes in contract, and it would depend entirely on the statutory/case law of a given jurisdiction as to how this matter would be handled.  A lot of time would be devoted into looking into your intent in making that change and did you have 'unclean hands' in doing so.

Is it an amendment if you enter the new text before the other party signs and makes the contract?  Pretty sure they won't be able to rely on mistake if the text is clear (mistake doesn't cover failure to read the contract anywhere I imagine)

[RevDisk]

That would probably be a pretty classic contract law question.  Generally speaking, a modification or amendment of a contract is only valid if it is agreed to by both parties.  You would want to show that both parties agree by a writing, such as both parties initialing the modification or amendment or explicitly stating that the modification or amendment is agreed to and incorporated into the contract.  Something like you described would probably be treated as a unilateral mistake and would not necessarily render the contract void.  However, there are probably several linear feet of appellate court opinions in that jurisdiction on how to treat mistakes in contract, and it would depend entirely on the statutory/case law of a given jurisdiction as to how this matter would be handled.  A lot of time would be devoted into looking into your intent in making that change and did you have 'unclean hands' in doing so.

Yep. I asked a non-practicing contracts lawyer and a practicing corporate lawyer. They only gave non-committal answers, which I am aware is standard. They were both my bosses, so they had a pretty good reason to get nervous when I asked "strictly theoretical" questions. Like asking the company position on dumpster diving. Or dumpster diving via proxy. Or if one had to answer "are you a felon" positively if the US does not recognize the ICC or the court system of the foreign country that alleged crimes occurred. Or why we owned an AC-130. Pretty normal questions get really weird when lawyers get involved.



 

[MillCreek]

Is it an amendment if you enter the new text before the other party signs and makes the contract?  Pretty sure they won't be able to rely on mistake if the text is clear (mistake doesn't cover failure to read the contract anywhere I imagine)

I would argue that any handwritten modifications to a printed contract is an amendment by the party entering the additional language.

[KD5NRH]

Or why we owned an AC-130.

Were you working for the Department of Education at the time?

On the signature thing, I had a friend who made a practice of being able to sign his name in a pretty good rendition of other people's handwriting.  In the case of contracts he didn't like, he'd get the other person to write something down, then sign in their handwriting.  Not sure if any of those ever got to court, but I can imagine a judge not having the least amount of difficulty believing that some HR rep decided to forge a "forgotten" signature when it doesn't match 2-3 other signatures from the same paperwork session.

[Jocassee]

Or why we owned an AC-130.

I can't think of a good reason NOT to own an AC-130.

[MillCreek]

I can't think of a good reason NOT to own an AC-130.

True dat, but I wonder what the operating cost per hour of an AC-130 is.

[K Frame]

True dat, but I wonder what the operating cost per hour of an AC-130 is.

If you have to ask, you can't afford it.

[HankB]

That would probably be a pretty classic contract law question.  Generally speaking, a modification or amendment of a contract is only valid if it is agreed to by both parties.  You would want to show that both parties agree by a writing, such as both parties initialing the modification or amendment or explicitly stating that the modification or amendment is agreed to and incorporated into the contract.  Something like you described would probably be treated as a unilateral mistake and would not necessarily render the contract void.  However, there are probably several linear feet of appellate court opinions in that jurisdiction on how to treat mistakes in contract, and it would depend entirely on the statutory/case law of a given jurisdiction as to how this matter would be handled.  A lot of time would be devoted into looking into your intent in making that change and did you have 'unclean hands' in doing so.

First off, I'll state that IANAL. And this story is a little short on details, since it's at least 10 years old and reproduced by memory.

But I remember reading that a company had sent some sort of tech agreement or NDA out to a new hire for his signature; he didn't like the terms, so he changed them, printed out a new form, signed it, made a copy for himself, and sent the signed version back to the employer, who accepted it without comment and hired him.

Fast forward a couple of years . . . he separated from the company, the company tried to enforce what they THOUGHT was his signed agreement, but when it came to court and they were ordered to produce THEIR copy . . . with his signature, it turned out to include things they didn't know were in there. In fact, IIRC, they didn't know the form was different until the guy's lawyer had THEIR guy read a few specific lines in front of the judge.

The separated employee won.

As for technical agreements - the one I signed (unaltered) put some restrictions on working for a competitor for 2 years without my employer's permission, but if they kept me from working, they'd have to continue my salary for that period.

[RevDisk]

I can't think of a good reason NOT to own an AC-130.

True dat, but I wonder what the operating cost per hour of an AC-130 is.

We made a profit off the operating costs. We back charged to the client for costs, along with a normal markup.

Long story short, I asked on a conference call with all the sub business unit legal entities on the call. Which I'm sure made my boss happy. We had a standardized power point slide deck that was religiously kept up to date with all the aircraft we made, owned, serviced, whatever. Well, new week, new slide deck. With an C-130. With guns on it... So I asked. Administratively we 'purchased' it for like a two or three month period. It wasn't even being moved or whatnot. Not sure if we bought from LockMart directly, or the USG. It was part of a package deal to some other country, which wasn't unusual. That's how we got roped into the Blackwater investigation. We were buying X, Y, Z for Customer ABC, which Blackwater was the primary contractor to 'handle' the process. They were skimming the shipments, on OUR export license from State. Dumbest part is, it's entirely legal as long as you have the proper paperwork and aren't transferring to prohibited/proscribed entities. Which they didn't, and were. Normally the end customer just wanted everything on one export license or amend an existing export license, rather than do fifty bazillion licenses or start from scratch. Less work for DDTC, so they didn't care as long as we stayed compliant with all the rules.

Back on topic, I've normally only seen non-competes for execs or very high level engineers. Who were compensated, to some extent, for those requirements. Most of the companies I worked for didn't actively hate their employees and want to reduce their quality of life. Hubris, people being stupid (rather than malice) and disorganization was the primary cause of bad things.

[charby]

Non-competes are evil.  Between things like that and the increasing offshoring of work, I'm starting to wonder if white-collar unions may be a solution. 

Chris

I've been thinking that for a while. A lot of specialized skills are getting paid low wages for what they do and their importance. Like there is a secret cartel to keep wages suppressed in some industries.

[RevDisk]

I've been thinking that for a while. A lot of specialized skills are getting paid low wages for what they do and their importance. Like there is a secret cartel to keep wages suppressed in some industries.

Already has made the news. When they're caught, they get a slap on the wrist and generally go back to whatever they were doing. With some mild policy changes that are more lawsuit resistant but fundamentally the same.

https://phys.org/news/2015-09-415m-settlement-apple-google-wage.html

64,000 technology workers, got allegedly $5,800 apiece. After lawyers, figure $3k each. I somewhat suspect all of the companies involved saved more than a couple grand a head in wage fixing.

Not just technology companies. Animation companies got mildly 'caught' as well.

https://pando.com/2014/07/07/revealed-court-docs-show-role-of-pixar-and-dreamworks-animation-in-silicon-valley-wage-fixing-cartel/


Video game industry is widely suspected of wage and hiring cartels, but still unproven. H1B visas are a 'legal' way of wage fixing. That is still routinely misused in blatantly illegal ways.

[KD5NRH]

As for technical agreements - the one I signed (unaltered) put some restrictions on working for a competitor for 2 years without my employer's permission, but if they kept me from working, they'd have to continue my salary for that period.

Which is as it should be.  I'd even grant them only paying the difference between weekly pay rate at separation and full time minimum wage (unless the employee can also show at least a few minimum wage jobs they're also excluded from by the agreement) as long as other benefits are also continued or appropriate additional compensation offered.  Maybe even a one-time payment option; say, 75% of the duration paid up front at termination, saving them 25% overall and giving the employee a substantial sum to make other arrangements.  (Like additional education to move to an unrestricted field or paying off debts to make it easier to get by at whatever job can be found.)

[De Selby]

I would argue that any handwritten modifications to a printed contract is an amendment by the party entering the additional language.

Don't you need a contract in the first place for it to be an amendment?  It can't be a contract if the signer rewrote the terms and gave it back to you first without your guy accepting it. And I can't see how that acceptance would be a mistake except if failure to read the terms offered was actually legitimate grounds to argue mistake.

Edit:  this is a fascinating topic for me...never come across people who try to change form contracts on the spot this way