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Really naive question: I can see why an individual company would include non-compete clauses if legally allowed to. But who actually benefits from non-compete
by chmod600 6y ago
Really naive question:
I can see why an individual company would include non-compete clauses if legally allowed to. But who actually benefits from non-compete clauses being allowed? Aren't companies hurt more with hiring difficulties and unmotivated employees sticking around than whatever benefit they get avoiding raises?
Are there really a bunch of managers thinking "I want an engineering team that is stuck here and just plods along fixing one bug a week".
- filmgirlcw 6y agoIt’s not about the employees being stuck there. The employee can quit for a new job and then just gets sued before they can start work. So then the employee either has to wait out the non-compete period (sometimes these are paid out), losing valuable work time, or they have to get a job in a demonstrably different sector/area, where skill transfer may not be as advantageous. You’re right that this does create a toxic, unmotivated workforce. That said, it can also instill fear in employees from looking for other positions and helps keep wages depressed, since people can’t be persuaded to leave for competitors with higher salaries. It’s about control.