5 ms·

Agreed with the silly use of the name 'poaching'. But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Its poi

by _red 9y ago

Agreed with the silly use of the name 'poaching'. But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Its pointless anyway, a first year law student will just rewrite as non-circumvent + no-solicit + NDA agreements.

acdha 9y ago
The problem comes from the market disparity: most employees need the job and have limited bargaining power or legal representation while the company has a whole legal team representing their interests. Similarly, the company has a lot more data points on terms and compensation than the prospective worker. As a simple example, the Jimmy John's sandwich chain had a no-compete for their employees. Do you think the average person making subs is as comfortable walking away from a job as the company is telling them the terms aren't negotiable? My favorite fix would simply to be requiring full compensation for the entire term. Intel would pay an architect to sit on the beach rather than work for AMD but nobody would think of trying that for the average developer.
- _red 9y ago
  >As a simple example, the Jimmy John's sandwich chain had a no-compete for their employees. Do you think the average person making subs is as comfortable walking away from a job as the company is telling them the terms aren't negotiable? Its true they did have that contract. However it was never enforced and once news of it broke they dropped it. It would like never been enforced since its clearly unlawful. Any legal contract must have 5 parts: (a) Offer, (b) Consideration, (c) Term, (d) Good Faith, and (e) Acceptance. The "Good Faith" provision means that no part of any contract is either for one part or the other. The contract is implied to be "equal" in all parts. Such a tact of getting low-paid workers to sign non-competes clearly violates this, thus why it was basically unenforceable. Now, just because some company tried to write a dumb contract, should we make all contracts illegal?
  - acdha 9y ago
    We don't know whether they tried to use it and reached an agreement covered by an NDA (do you accept or spend 10X the amount on legal fees?). Similarly, we don't know whether it was ever threatened as part of a labor dispute: I first heard about it in conjunction with the class action lawsuit about unpaid overtime and it's very easy to imagine that the same manager trying to do that wouldn't hesitate to threaten someone's ability to find another job, secure in the knowledge that nobody working that job has the resources to lawyer up. That power disparity is the fundamental flaw in your argument. The theory you're repeating sounds great as long as the parties have roughly equal power and knowledge, which just isn't true.
vkou 9y ago
> Agreed with the silly use of the name 'poaching'. But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Because any analysis of contracts that does not take into account the relative power of the parties entering them is an incredibly naive one.
ScottBurson 9y ago
> But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Because those voluntary contracts affect the economy as a whole. By preventing the worker from making use of even their non-proprietary general knowledge, they make the economy less efficient -- especially so when it comes to the formation of new ventures. And empirically, prohibiting noncompetes works. I understand that California, if we were a separate country, would have the world's seventh (or sixth?) largest economy. I certainly would be very hesitant to accept a job offer in any other state. (Well, someone posted upthread that North Dakota and Oklahoma also prohibit noncompetes, but I don't think I want to live in either of those places, for other reasons.)
fnj 9y ago
Most societies consider that there are certain human rights (the right to make one's livelihood in this case) which should not be subject to voluntarily relinquishing. Do you think it would be a fine thing to allow signing oneself into involuntary servitude, for example?
siegel 9y ago
This is just not the way contract interpretation and enforcement works. It never has. The law has always recognized public policy considerations that sometimes outweigh the benefit of enforcing a particular contract. I'd be shocked if you didn't agree with some of examples of such contracts. For example, if A contracts with B for B to murder C, A cannot sue B for breaching that contract. California decided that the public policy of fostering freedom to practice one's profession outweighs the interest in enforcing contractual non-compete provisions. You may not agree. But, in the end, this is all about public policy goals. Framing the question as about the "state preventing two people voluntarily entering into a contract" isn't quite correct. The question really is whether the state should get itself involved in ENFORCING a particular agreement. Generally, the state will do so because a functioning economy is dependent upon enforceable contracts. But that is just one public policy interest to be weighed against others in particular instances.

by _red 9y ago

acdha 9y ago

The problem comes from the market disparity: most employees need the job and have limited bargaining power or legal representation while the company has a whole legal team representing their interests. Similarly, the company has a lot more data points on terms and compensation than the prospective worker. As a simple example, the Jimmy John's sandwich chain had a no-compete for their employees. Do you think the average person making subs is as comfortable walking away from a job as the company is telling them the terms aren't negotiable? My favorite fix would simply to be requiring full compensation for the entire term. Intel would pay an architect to sit on the beach rather than work for AMD but nobody would think of trying that for the average developer.

_red 9y ago
>As a simple example, the Jimmy John's sandwich chain had a no-compete for their employees. Do you think the average person making subs is as comfortable walking away from a job as the company is telling them the terms aren't negotiable? Its true they did have that contract. However it was never enforced and once news of it broke they dropped it. It would like never been enforced since its clearly unlawful. Any legal contract must have 5 parts: (a) Offer, (b) Consideration, (c) Term, (d) Good Faith, and (e) Acceptance. The "Good Faith" provision means that no part of any contract is either for one part or the other. The contract is implied to be "equal" in all parts. Such a tact of getting low-paid workers to sign non-competes clearly violates this, thus why it was basically unenforceable. Now, just because some company tried to write a dumb contract, should we make all contracts illegal?
- acdha 9y ago
  We don't know whether they tried to use it and reached an agreement covered by an NDA (do you accept or spend 10X the amount on legal fees?). Similarly, we don't know whether it was ever threatened as part of a labor dispute: I first heard about it in conjunction with the class action lawsuit about unpaid overtime and it's very easy to imagine that the same manager trying to do that wouldn't hesitate to threaten someone's ability to find another job, secure in the knowledge that nobody working that job has the resources to lawyer up. That power disparity is the fundamental flaw in your argument. The theory you're repeating sounds great as long as the parties have roughly equal power and knowledge, which just isn't true.

vkou 9y ago

> Agreed with the silly use of the name 'poaching'. But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Because any analysis of contracts that does not take into account the relative power of the parties entering them is an incredibly naive one.

ScottBurson 9y ago

> But how exactly is the state preventing two people voluntarily entering into a contract a good thing? Because those voluntary contracts affect the economy as a whole. By preventing the worker from making use of even their non-proprietary general knowledge, they make the economy less efficient -- especially so when it comes to the formation of new ventures. And empirically, prohibiting noncompetes works. I understand that California, if we were a separate country, would have the world's seventh (or sixth?) largest economy. I certainly would be very hesitant to accept a job offer in any other state. (Well, someone posted upthread that North Dakota and Oklahoma also prohibit noncompetes, but I don't think I want to live in either of those places, for other reasons.)

fnj 9y ago

Most societies consider that there are certain human rights (the right to make one's livelihood in this case) which should not be subject to voluntarily relinquishing. Do you think it would be a fine thing to allow signing oneself into involuntary servitude, for example?

siegel 9y ago

This is just not the way contract interpretation and enforcement works. It never has. The law has always recognized public policy considerations that sometimes outweigh the benefit of enforcing a particular contract. I'd be shocked if you didn't agree with some of examples of such contracts. For example, if A contracts with B for B to murder C, A cannot sue B for breaching that contract. California decided that the public policy of fostering freedom to practice one's profession outweighs the interest in enforcing contractual non-compete provisions. You may not agree. But, in the end, this is all about public policy goals. Framing the question as about the "state preventing two people voluntarily entering into a contract" isn't quite correct. The question really is whether the state should get itself involved in ENFORCING a particular agreement. Generally, the state will do so because a functioning economy is dependent upon enforceable contracts. But that is just one public policy interest to be weighed against others in particular instances.