4 ms·

I am a junior dev hired to an HFT firm. I was excited to have 6 months of free pay just to not work :(

by mr_00ff00 3y ago

pc86 3y ago
That's not how non-competes work.
- cbg0 3y ago
  It is in Europe.
- blerud 3y ago
  It is at many HFT firms, including mine. You will be paid your base salary for some number of months to not work at a competitor, even if you don't have a signed offer for a competitor and just want to sit around
  - chimeracoder 3y ago
    > It is at many HFT firms, including mine. You will be paid your base salary for some number of months to not work at a competitor, even if you don't have a signed offer for a competitor and just want to sit around That's called "garden leave" and it's completely different from non-compete agreements as discussed by this bill.
    - pclmulqdq 3y ago
      "Garden leave" wasn't a common term when I was in HFT in NYC. It was just called a "non-compete" (possibly confusingly).
      - ghaff 3y ago
        Garden leave is just a (usually?) legal (or at least contractual) requirement associated with non-compete agreements in some jurisdictions. Unsurprisingly, it was originally a British term, although it meant something different.
        pclmulqdq 3y ago
        Personally, the only time I ever heard it was from the mouths of British recruiters.
      - chimeracoder 3y ago
        > "Garden leave" wasn't a common term when I was in HFT in NYC. It was just called a "non-compete" (possibly confusingly). The terms are used somewhat interchangeably in colloquial use, because (at least as of now) the distinction isn't meaningful for most people. The point is that garden leave isn't targeted by this bill.
        frankc 3y ago
        I don't think that is true, or at least I have not seen that anywhere. My understanding is this bill removes any kind of non-competes. It was already basically unenforcible to have an unpaid non-compete in New York (through common law)
        chimeracoder 3y ago
        > It was already basically unenforcible to have an unpaid non-compete in New York (through common law) That is not true - there are four criteria for non-competes to be valid in NY, and payment for the duration is not one of them. > I don't think that is true, or at least I have not seen that anywhere. My understanding is this bill removes any kind of non-competes. There are two bills - one of them requires payment for noncompetes.
        delfinom 3y ago
        The first bill outlaws all non-competes and garden leave would fall under it. The most they could do is offer it as a form of severance where you get to sit on your butt for 6 months conditionally. The second bill would allow for garden leave aka compensated non-competes. It just codifies the "don't try any non-compensated/good faith aspect".
    - masklinn 3y ago
      A garden leave is a form of compensated non-compete. The entire point is that you’re paying a former employee to not compete (in this case to literally not work).
- bshipp 3y ago
  If companies actually paid employees not to compete they would be able to keep them. Correct me if I'm wrong, but--at least where I live--non-competes lack legal authority (even before they were outlawed) because most companies don't provide compensation for limiting an ex-employee's ability to make a living in their field in the future. So, it's conceivable that an ex-employee could receive 6 months severance in trade for a non-compete of that length, but I doubt it's very popular.
  - slymon99 3y ago
    > If companies actually paid employees not to compete they would be able to keep them Why is this true? If someone is making $200k and leaving to make $350k, an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP, but not be able to match the $350k their new employer is offering. > So, it's conceivable that an ex-employee could receive 6 months severance in trade for a non-compete of that length, but I doubt it's very popular. It's quite popular in finance. Also, it's not a one time severance, its paid as a standard paycheck. A firm might "release" someone from their non compete while it is still active (basically saying it's no longer active and we are no longer paying you).
    - ghaff 3y ago
      And there are a ton of other reasons people change companies as well. >an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP Presumably there are other restrictions to just handing over IP but at least some of the reasoning for non-competes is that you can't really restrict the transfer of a lot of know-how even if they don't share corporate strategy decks.
    - bshipp 3y ago
      > Why is this true? If someone is making $200k and leaving to make $350k, an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP, but not be able to match the $350k their new employer is offering. Sorry, I worded that poorly. I meant companies could keep the ability to impose non-competes if they originally compensated employees who were let go. I know it gets muddled when it comes to employees moving around for increased pay, but non-competes aren't supposed to be a mechanism for holding down salaries. They're only intended to protect vital corporate secrets that, if they were released, would be so costly to the company that they'd risk bankruptcy. The value of those secrets would likely be enough that many competitors would be hesitant to hire those employees because they might fear opening themselves up to future litigation for patent infringement or IP or whatnot. The fact that many HR departments apply them to every single rank and file employee and don't explicitly define what constitutes a direct competitor or what explicit activities/information are protected by the NC is why they're a pretty useless legal tool in most circumstances.
- d_watt 3y ago
  It can be https://en.wikipedia.org/wiki/Garden_leave https://en.wikipedia.org/wiki/Garden_leave
- mywittyname 3y ago
  If a company wants to actually enforce a non-compete, then it can't be one-sided.
nburr 3y ago
Not at all how NCAs work in NYS or the US in general.
- deleted 3y ago
  [deleted]
xilni 3y ago
Garden leave is a different beast and seems fair, you and the employer each get something, non competes on the other hand do not usually offer anything to the employee.
- ghaff 3y ago
  Many garden leaves as a condition of having a non-compete aren't a great deal though. I think the fairly recent Massachusetts law is 50% pay--and that may be of just base pay. It might be a good deal if you want to travel in your twenties. It may not be such a great deal if you have a mortgage to pay and family to support and you're basically pressing pause on your career. It does make the company put skin in the game but if they decide to enforce anyway, it's better than nothing but hardly a panacea.
- esoterica 3y ago
  Paid non competes are also banned under the proposed law (and currently banned in California).
twunde 3y ago
Most companies do not pay for the period of time that a non-compete is in effect. What you're describing is somewhat different. Typically that's known as garden leave, and essentially you're treated as a current employee for the period of time, but you're not allowed to work. Which means that you'll likely have the 6 months of free pay. I'd definitely review your contract and the terms.
- doikor 3y ago
  Thankfully here in Finland non-competes are void if you are not paid. Basically the right to earn a living wins over any contract you could sign against it.
  - moffkalast 3y ago
    Didn't the EU ban non-compete clauses entirely recently anyway? Or did the law not go through yet.
    - rolisz 3y ago
      The EU doesn't pass laws, they pass some sort of recommendations that individual countries must implement as laws in a certain for another.
      - moffkalast 3y ago
        Well if you want to be technically correct, EU regulations are binding and must be implemented to the letter by all member countries without excuse or deviation. EU directives are the ones that have some leeway with local laws. Both are legislation though so might as well call them laws.
    - doikor 3y ago
      afaik (and based on a few minutes of googling) there is no such EU wide regulation or directive.
      - 3y ago
rrobukef 3y ago
You still lose as you won't get raises, bonuses or promotions. You may lose extra-legals like company cars, insurance (?), long term savings-matching. Even then your cost of living will probably increase due to not working.
- slymon99 3y ago
  Yea, the bonus point is interesting, especially in finance where bonuses can be > 100% of base. You can't insist on firms paying last years bonus, or else people would just quit and get a non compete if they had an insane year. But paying only base also seems a bit unfair. A thought I had was you'd have to pay whatever their new offer is paying. The argument is that if you want to prevent someone from working, you should have to pay them their worth - which, in the case of someone resigning with a competing offer - has just been priced by the hiring market!
  - rrobukef 3y ago
    Paying the wage of the new offer leads to bad incentives w.r.t. nepotism. It also discourages starting your own small business where you tend to pay yourself a small wage.
- kodah 3y ago
  > You still lose as you won't get raises, bonuses or promotions Jokes on me, I don't get raises or promotions anyway

I am a junior dev hired to an HFT firm. I was excited to have 6 months of free pay just to not work :(

pc86 3y ago

That's not how non-competes work.

cbg0 3y ago
It is in Europe.
blerud 3y ago
It is at many HFT firms, including mine. You will be paid your base salary for some number of months to not work at a competitor, even if you don't have a signed offer for a competitor and just want to sit around
- chimeracoder 3y ago
  > It is at many HFT firms, including mine. You will be paid your base salary for some number of months to not work at a competitor, even if you don't have a signed offer for a competitor and just want to sit around That's called "garden leave" and it's completely different from non-compete agreements as discussed by this bill.
  - pclmulqdq 3y ago
    "Garden leave" wasn't a common term when I was in HFT in NYC. It was just called a "non-compete" (possibly confusingly).
    - ghaff 3y ago
      Garden leave is just a (usually?) legal (or at least contractual) requirement associated with non-compete agreements in some jurisdictions. Unsurprisingly, it was originally a British term, although it meant something different.
      - pclmulqdq 3y ago
        Personally, the only time I ever heard it was from the mouths of British recruiters.
    - chimeracoder 3y ago
      > "Garden leave" wasn't a common term when I was in HFT in NYC. It was just called a "non-compete" (possibly confusingly). The terms are used somewhat interchangeably in colloquial use, because (at least as of now) the distinction isn't meaningful for most people. The point is that garden leave isn't targeted by this bill.
      - frankc 3y ago
        I don't think that is true, or at least I have not seen that anywhere. My understanding is this bill removes any kind of non-competes. It was already basically unenforcible to have an unpaid non-compete in New York (through common law)
        chimeracoder 3y ago
        > It was already basically unenforcible to have an unpaid non-compete in New York (through common law) That is not true - there are four criteria for non-competes to be valid in NY, and payment for the duration is not one of them. > I don't think that is true, or at least I have not seen that anywhere. My understanding is this bill removes any kind of non-competes. There are two bills - one of them requires payment for noncompetes.
      - delfinom 3y ago
        The first bill outlaws all non-competes and garden leave would fall under it. The most they could do is offer it as a form of severance where you get to sit on your butt for 6 months conditionally. The second bill would allow for garden leave aka compensated non-competes. It just codifies the "don't try any non-compensated/good faith aspect".
  - masklinn 3y ago
    A garden leave is a form of compensated non-compete. The entire point is that you’re paying a former employee to not compete (in this case to literally not work).
bshipp 3y ago
If companies actually paid employees not to compete they would be able to keep them. Correct me if I'm wrong, but--at least where I live--non-competes lack legal authority (even before they were outlawed) because most companies don't provide compensation for limiting an ex-employee's ability to make a living in their field in the future. So, it's conceivable that an ex-employee could receive 6 months severance in trade for a non-compete of that length, but I doubt it's very popular.
- slymon99 3y ago
  > If companies actually paid employees not to compete they would be able to keep them Why is this true? If someone is making $200k and leaving to make $350k, an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP, but not be able to match the $350k their new employer is offering. > So, it's conceivable that an ex-employee could receive 6 months severance in trade for a non-compete of that length, but I doubt it's very popular. It's quite popular in finance. Also, it's not a one time severance, its paid as a standard paycheck. A firm might "release" someone from their non compete while it is still active (basically saying it's no longer active and we are no longer paying you).
  - ghaff 3y ago
    And there are a ton of other reasons people change companies as well. >an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP Presumably there are other restrictions to just handing over IP but at least some of the reasoning for non-competes is that you can't really restrict the transfer of a lot of know-how even if they don't share corporate strategy decks.
  - bshipp 3y ago
    > Why is this true? If someone is making $200k and leaving to make $350k, an employer may well be able to afford the $100k for 6 months to prevent them from immediately handing over IP, but not be able to match the $350k their new employer is offering. Sorry, I worded that poorly. I meant companies could keep the ability to impose non-competes if they originally compensated employees who were let go. I know it gets muddled when it comes to employees moving around for increased pay, but non-competes aren't supposed to be a mechanism for holding down salaries. They're only intended to protect vital corporate secrets that, if they were released, would be so costly to the company that they'd risk bankruptcy. The value of those secrets would likely be enough that many competitors would be hesitant to hire those employees because they might fear opening themselves up to future litigation for patent infringement or IP or whatnot. The fact that many HR departments apply them to every single rank and file employee and don't explicitly define what constitutes a direct competitor or what explicit activities/information are protected by the NC is why they're a pretty useless legal tool in most circumstances.
d_watt 3y ago
It can be https://en.wikipedia.org/wiki/Garden_leave https://en.wikipedia.org/wiki/Garden_leave
mywittyname 3y ago
If a company wants to actually enforce a non-compete, then it can't be one-sided.

nburr 3y ago

Not at all how NCAs work in NYS or the US in general.

deleted 3y ago
[deleted]

xilni 3y ago

Garden leave is a different beast and seems fair, you and the employer each get something, non competes on the other hand do not usually offer anything to the employee.

ghaff 3y ago
Many garden leaves as a condition of having a non-compete aren't a great deal though. I think the fairly recent Massachusetts law is 50% pay--and that may be of just base pay. It might be a good deal if you want to travel in your twenties. It may not be such a great deal if you have a mortgage to pay and family to support and you're basically pressing pause on your career. It does make the company put skin in the game but if they decide to enforce anyway, it's better than nothing but hardly a panacea.
esoterica 3y ago
Paid non competes are also banned under the proposed law (and currently banned in California).

twunde 3y ago

Most companies do not pay for the period of time that a non-compete is in effect. What you're describing is somewhat different. Typically that's known as garden leave, and essentially you're treated as a current employee for the period of time, but you're not allowed to work. Which means that you'll likely have the 6 months of free pay. I'd definitely review your contract and the terms.

doikor 3y ago
Thankfully here in Finland non-competes are void if you are not paid. Basically the right to earn a living wins over any contract you could sign against it.
- moffkalast 3y ago
  Didn't the EU ban non-compete clauses entirely recently anyway? Or did the law not go through yet.
  - rolisz 3y ago
    The EU doesn't pass laws, they pass some sort of recommendations that individual countries must implement as laws in a certain for another.
    - moffkalast 3y ago
      Well if you want to be technically correct, EU regulations are binding and must be implemented to the letter by all member countries without excuse or deviation. EU directives are the ones that have some leeway with local laws. Both are legislation though so might as well call them laws.
  - doikor 3y ago
    afaik (and based on a few minutes of googling) there is no such EU wide regulation or directive.
    - 3y ago

rrobukef 3y ago

You still lose as you won't get raises, bonuses or promotions. You may lose extra-legals like company cars, insurance (?), long term savings-matching. Even then your cost of living will probably increase due to not working.

slymon99 3y ago
Yea, the bonus point is interesting, especially in finance where bonuses can be > 100% of base. You can't insist on firms paying last years bonus, or else people would just quit and get a non compete if they had an insane year. But paying only base also seems a bit unfair. A thought I had was you'd have to pay whatever their new offer is paying. The argument is that if you want to prevent someone from working, you should have to pay them their worth - which, in the case of someone resigning with a competing offer - has just been priced by the hiring market!
- rrobukef 3y ago
  Paying the wage of the new offer leads to bad incentives w.r.t. nepotism. It also discourages starting your own small business where you tend to pay yourself a small wage.
kodah 3y ago
> You still lose as you won't get raises, bonuses or promotions Jokes on me, I don't get raises or promotions anyway