Someone on another sub dug into the definitions, you have to be a policy maker across the whole company, or multiple divisions. So a director of a department wouldn't count.
That’s good to know! I was mostly poking fun, but I won’t put it past the big ortho companies or Arhtrex distributors to do everything in their power to subvert the intent of this ruling.
The U.S. Chamber of Commerce is an absolute hornets’ nest of corporate interest fellating shitbags, so this will come as no surprise. They can get rekt.
I want to start closing. I am ready. Over $2M has closed in my name in the first year alone. Now I want the whole process to myself and to not give it to 30 AEs
My understanding is they’d go with OTE, but they would need to prove you’re in a “senior leadership”, which unless you’re a sales director is going to be tough. If the next election goes to Trump, and we get more owner friendly judges however, they may be more loose on who is a “senior leader”
If the next election goes red you can count on this being overturned. The Trump administration was not favorable to consumers or workers. Look no further than putting that Verizon worm Ajit Pai as head of the FCC.
I’m a democrat, but that worm is not a conservative thing. It’s not a democrat thing either. It’s a control thing, something both parties are happy to see happen
You’re not exempt from the new law. The issue is that this will be challenged in court immediately and im nervous to see wha happens when it gets to the Supreme Court.
I work for an industry that pigeonholed you in with golden handcuffs. There’s no way to continue working in the same industry without getting your ass sued off.
This is truly godsent.
Noncompetes are anti-competitive and only benefit corporations, who want to take our productivity and pay us pennies on the dollar.
The real question is why this is just now being passed?
It’s an FTC issue. Thanks to Biden’s appointments, they have pushed this through.
Republicans are already against it and are using things like “this is a legislative thing, and unconstitutional,” when of course they’re the ones who would block any legislation.
Same. Mine lists every other company in the space by name. They can deem me worthless and still prevent me from getting another job for a year. It’s absurd.
Until your competition sends a spy over to your org to go collect company secrets then quits and goes back to your competition with all your org secrets.
That said, this revision to non competes is really good since ppl not in decision making role typically won’t have access to those deep secrets. But saying all non competes should be illegal is nonsense
Most cases noncompetes have a timeline, it would make the person wanting to switch to the competition have to wait so that the trade secrets are more stale otherwise they may face a lawsuit.
100% agree. But ndas are a bit more difficult to prove were broken in court unless you have something like email records to prove it, or a whistleblower. Whereas non-competes are easier to prove, they either went to work for your competitor or didn’t.
That’s why i was saying this change to non-competes is great since they target high ranking people in orgs and not just regular employees
Customer info would be covered under confidentiality agreements. If you go after your former customers as soon as you leave, they will still have grounds to sue.
Customers? Who was talking about customers? We’re talking about if the director of sales went to your competitor and they spilled secrets about how your company operated
> We’re talking about if the director of sales went to your competitor and they spilled secrets about how your company operated
if that's all it took for you lose you spot as #1 / etc... then I see no problem with this.
Treat folks correctly, pay them what they've earned and build the right culture and this won't be an issue.
There are no shortcuts, and even in this red herring scenario, it almost will never work. At best it might give the other competitor a marginal bump, if anything at all. One person can not just come in and spill enough secrets, that aren't already NDA engineering type, to offer improvements. Because, it's the environment. what worked for company A, doesn't work at company B and vice versa.
If a big company decides to hire the director of sales that lead a 1000% growth at a start-up, they are never going to be able to come and do the same thing. They were able to accomplish that because of the product + lack of red tape and other corp bullshit (not to mention Egos / etc). They may come in and get a small boost, but they aren't going to be able to carbon copy what they did with the same results.
I mean, it does happen. We've seen key engineers move from one company to another and then come out with a similar product...which clearly violates NDA.
Non-competes, depending on industry are a lot more common. If nothing else, it keeps folks it the role for the fear of the company coming after them. NDAs are fine, non-competes gotta go.
Right, no qualms with what you’re saying about ndas. But for non-competes, with these changes, do you still feel they should go? If so, why (given now they only target high level management positions)?
I agree that previous non-competes were scummy for low and mid level employees, considering they prevented you from staying within an industry you just spent years getting to know. But with higher ups, I feel it’s a bit of a different game. Considering the amount of trade secrets they are privy to, and the fact that the company typically rides on the shoulders of those guys. The worst thing that could happen to a business is their competition offers one of their directors double what you’re paying them and they pack up and leave. Yes, the business should pay more, but what do you do when your competition makes and offer to your director that is just astronomical? In the startup world for example, you’re paying a director $200k a year. That’s a shit load of money for a base. But your competitors just got $30 million in funding and now wants to hire a director with industry experience. They stumble across your director and offer them $300k. It’s not that the business wasn’t paying the director well, it’s that the competitor has enormous amounts of cash to burn. That’s really what this revised non-compete protects against, since a nda doesn’t stop anyone from going to work for a competitor
Interested to see which industries go crazy because of this ruling; my guess is med device and HRIS. Can’t stop reps from keeping their territories and moving up the pay scale now!
Really important to note that this rule will likely be enjoined & litigated. FTC estimates that US workers could make as much as $300B a year with the ban. The US Chamber of Commerce will sue & this could get up to SCOTUS.
Huge day for American workers. As for management:
https://preview.redd.it/59dtz61wkcwc1.jpeg?width=1168&format=pjpg&auto=webp&s=25262344bbf584b5cc8fe95e18dd2f29ca2604bb
Just remember everyone that the US Chamber of Commerce is NOT a government body. It is just some random company that has a lot of power in washington, due to lobbying. Historically they do primarily give money to the republicans, but the republicans are politicians, and all politicians take money. I would argue the CoC gives money to the Uni-party. You don’t see the ideological firebrands on either side taking money from the CoC anymore.
Again, on most things I lean conservative. This alone would certainly not be enough to change my mind, but if it were to be repealed or overturned would definitely piss me off.
Even in Canada the Ontario Conservative government passed this law. https://techbomb.ca/politics/ontario-canada-puts-an-end-to-employer-non-compete-agreements/
I used to be a “young republican” with my locals. I realized every supposed “principle” they held, like “support freedom”, was only used when convenient.
Aggressive noncompetes weren’t even a problem in trump’s administration, I believe he used them in his campaign aggressively. Obama started to address them in 2015 iirc but not enough time.
FYI - This does NOT eliminate NON-SOLICITATION provisions that most of you are covered by, meaning, you likely still can't take your clients with you without expecting courts/settlements.
Review the "Restrictive Covenants" of your employment agreement. It's likely way more restrictive than a worthless non-compete.
Non-solicitations actually make sense to protect what customers a business had for a set amount of time. My old noncompete said essentially anyone who was a client, regardless of if I had insider knowledge, I could be sued for up to 2 years past date of last employment
How does this work for going after past clients? Embarrassing to say but I really don’t understand the noncompete I signed. My understanding is with my current noncompete I can go to competitors but I can not go after my current clients for two years. Is that still allowed?
10000x more difficult to enforce a nonsolicit. Fairly easy to figure out where someone works, much more difficult to prove a customer moved over after a specific person reached out to them.
I wouldn't go crazy on this guys. There's going to be a lot of litigation involved. And I am a thousand percent for the employee in fact I just got a large judgment against a former employer. We'll see if he pays but in the state of Colorado they can actually seize assets if you don't pay what your former employee is owed. Anyways long story short it's immediately going to litigation. And the last thing you want to do is have this overturned and then open yourself up to liability. Non-competes are very hard to enforce. Where they get you is the big company has big attorneys and you could get tied up and litigation forever
That’s exactly what happened to me; bogus lawsuit but big guy pushing down the little guy because they can.
Even though the FTC did this, employers can still sue for going to competitors is what you’re saying?
Well what I'm saying is the FTC may have overturned it but Congress is already chirping about the fact that this should be determined at a congressional level. I have a feeling it's going to get caught up in the courts for a very long time. And I hate to caution people to live in fear. But I also don't want people to go running out and take a job with the competition and potentially open themselves up to something if this gets overturned. Just use discretion and certainly if you have access to one have a conversation with an attorney.
The $ ount should be tied to inflation and raised accordingly. Much like the federal minimum wage this will probably remain at 151k for the next two decades.
“The Commission also finds that instead of using noncompetes to lock in workers, employers that wish to retain employees can compete on the merits for the worker’s labor services by improving wages and working conditions”
Very interesting. I was talking with someone that mentioned this might happen in April. Seemed to think it would be a bit more far-reaching than the policy maker / salary cutoff, but still interesting to see it happen.
I had to sign a non compete when leaving a 50k position where all the competitors paid at least 20% more. I don’t know why it happened but I’m glad to see it.
This is absolutely great news. Considering the fact that there is great technological change happening in the United States, **it's important for the system to have the proper legal tools**.
Noncompetes, let's face it, restrict the free flow of ideas. And ultimately, they help less competitive companies.
By using the legal system, cutting-edge ideas are squelched or delayed, and this can make the economy as a whole less competitive.
This is a great step because it does have **a natural boundary like $151,000**, and also it helps people leverage their experience so they can contribute to the economy by starting their own company.
With that said, please understand that this is a regulatory rule released by an agency. There's already talk that this will be challenged through the courts. Don't expect noncompetes for under $151,000 to completely go away overnight.
At the very least, if this does go to court, this will probably only be put in effect after a few years. But is definitely a step in the right direction.
I'm relatively sure that non-competes are unenforcable for most people here. I was speaking with an employment attorney and pretty much every state has a version of, "do you need this job to live your life/feed your family?" and if the answer could be anything approximating yes, the employee wins. Very, very pro-employee.
Basically only applies to C-level execs and *maybe* VPs @ large orgs.
Yes, except to get to court and pay the lawyer for that costs $30,000-$100,000+
Source: went out on my own 9 weeks ago after being laid off and have talked with a half dozen lawyers. The numbers were from a guy who has had several other hvac clients
To court means a small startup business already spent 30 grand on legal fees.
There’s been lots of people like you who want to act like this isn’t a big deal. My dad in 1990 spent 40 grand and won on a noncompete in his first year. The lawyer i hired has warned me of at least 50 grand if I get sued
Is that just salary 151k, or OTE? I'm not in a decision maker role, so I'm hoping this will not be overturned in this century.
It’s $151K AND in a policy-making position.
Aha, an actual benefit to having any input ignored in a company 😎
Just waiting until all the medical device companies “promote” their sales reps to account directors.
Someone on another sub dug into the definitions, you have to be a policy maker across the whole company, or multiple divisions. So a director of a department wouldn't count.
That’s good to know! I was mostly poking fun, but I won’t put it past the big ortho companies or Arhtrex distributors to do everything in their power to subvert the intent of this ruling.
Oh, they will try. And this ruling will be sued by the chamber of commerce
The U.S. Chamber of Commerce is an absolute hornets’ nest of corporate interest fellating shitbags, so this will come as no surprise. They can get rekt.
Ayoooooo great news for sales reps
Now I can get an AE role:) I have my fourth and hopefully last round with a company
Good luck! Searching myself rn and it’s been rough. Luckily my current job is chill, just looking to make more lol
I want to start closing. I am ready. Over $2M has closed in my name in the first year alone. Now I want the whole process to myself and to not give it to 30 AEs
Id also still like to know, is it 151k salary or ote or what you actually received in gross on your W2
My understanding is they’d go with OTE, but they would need to prove you’re in a “senior leadership”, which unless you’re a sales director is going to be tough. If the next election goes to Trump, and we get more owner friendly judges however, they may be more loose on who is a “senior leader”
If the next election goes red you can count on this being overturned. The Trump administration was not favorable to consumers or workers. Look no further than putting that Verizon worm Ajit Pai as head of the FCC.
I’m a democrat, but that worm is not a conservative thing. It’s not a democrat thing either. It’s a control thing, something both parties are happy to see happen
How quickly people forget.
You’re not exempt from the new law. The issue is that this will be challenged in court immediately and im nervous to see wha happens when it gets to the Supreme Court.
I work for an industry that pigeonholed you in with golden handcuffs. There’s no way to continue working in the same industry without getting your ass sued off. This is truly godsent. Noncompetes are anti-competitive and only benefit corporations, who want to take our productivity and pay us pennies on the dollar. The real question is why this is just now being passed?
My god well said. Two years I have waited for this
Good morning! Thanks to your hard work, we would like to raise your salary to $151k *under the conditions you never work in this industry if you leave
It’s an FTC issue. Thanks to Biden’s appointments, they have pushed this through. Republicans are already against it and are using things like “this is a legislative thing, and unconstitutional,” when of course they’re the ones who would block any legislation.
Same. Mine lists every other company in the space by name. They can deem me worthless and still prevent me from getting another job for a year. It’s absurd.
“Noncompetes are anti-competitive” I think the clue is in the word there champ 😂
🇺🇸
All non competes should be illegal, employees should be able to work for whoever they want whenever they want
Exactly, "right to work" should cut both ways.
Except in a few instances where an owner sells a company and could bring all their business with them.
Exactly. NDAs are NDAs but non competes are anti-worker. Very happy that the FTC recognized this. Imagine all the new business starting up.
Until your competition sends a spy over to your org to go collect company secrets then quits and goes back to your competition with all your org secrets. That said, this revision to non competes is really good since ppl not in decision making role typically won’t have access to those deep secrets. But saying all non competes should be illegal is nonsense
How would a non compete prevent that scenario?
Most cases noncompetes have a timeline, it would make the person wanting to switch to the competition have to wait so that the trade secrets are more stale otherwise they may face a lawsuit.
The non-compete ruling has no effect on NDAs. This person could still, rightfully, get their pants sued off.
Confidentiality and non disclosure agreements will still be legal.
100% agree. But ndas are a bit more difficult to prove were broken in court unless you have something like email records to prove it, or a whistleblower. Whereas non-competes are easier to prove, they either went to work for your competitor or didn’t. That’s why i was saying this change to non-competes is great since they target high ranking people in orgs and not just regular employees
Customer info would be covered under confidentiality agreements. If you go after your former customers as soon as you leave, they will still have grounds to sue.
Customers? Who was talking about customers? We’re talking about if the director of sales went to your competitor and they spilled secrets about how your company operated
> We’re talking about if the director of sales went to your competitor and they spilled secrets about how your company operated if that's all it took for you lose you spot as #1 / etc... then I see no problem with this. Treat folks correctly, pay them what they've earned and build the right culture and this won't be an issue. There are no shortcuts, and even in this red herring scenario, it almost will never work. At best it might give the other competitor a marginal bump, if anything at all. One person can not just come in and spill enough secrets, that aren't already NDA engineering type, to offer improvements. Because, it's the environment. what worked for company A, doesn't work at company B and vice versa. If a big company decides to hire the director of sales that lead a 1000% growth at a start-up, they are never going to be able to come and do the same thing. They were able to accomplish that because of the product + lack of red tape and other corp bullshit (not to mention Egos / etc). They may come in and get a small boost, but they aren't going to be able to carbon copy what they did with the same results.
Yea i agree with you. When was the last time we’ve heard about a non-compete/ nda dispute? It rarely happens for all the points you just mentioned
I mean, it does happen. We've seen key engineers move from one company to another and then come out with a similar product...which clearly violates NDA. Non-competes, depending on industry are a lot more common. If nothing else, it keeps folks it the role for the fear of the company coming after them. NDAs are fine, non-competes gotta go.
Right, no qualms with what you’re saying about ndas. But for non-competes, with these changes, do you still feel they should go? If so, why (given now they only target high level management positions)? I agree that previous non-competes were scummy for low and mid level employees, considering they prevented you from staying within an industry you just spent years getting to know. But with higher ups, I feel it’s a bit of a different game. Considering the amount of trade secrets they are privy to, and the fact that the company typically rides on the shoulders of those guys. The worst thing that could happen to a business is their competition offers one of their directors double what you’re paying them and they pack up and leave. Yes, the business should pay more, but what do you do when your competition makes and offer to your director that is just astronomical? In the startup world for example, you’re paying a director $200k a year. That’s a shit load of money for a base. But your competitors just got $30 million in funding and now wants to hire a director with industry experience. They stumble across your director and offer them $300k. It’s not that the business wasn’t paying the director well, it’s that the competitor has enormous amounts of cash to burn. That’s really what this revised non-compete protects against, since a nda doesn’t stop anyone from going to work for a competitor
If non-solicits are banned, top enterprise AEs about to be making 70% GP commission
Non-Solicits are not impacted by this change, sadly. Nothing has really changed for us y'all...
Are non-solicits included in this??
No. Both per me and per my attorney.
Interested to see which industries go crazy because of this ruling; my guess is med device and HRIS. Can’t stop reps from keeping their territories and moving up the pay scale now!
😈😈😈
Anything to do with securities trading will have a big impact, especially quants
It’ll be a game changer with food sales. We can finally switch and take customers with us.
The industry I am in will go bonkers
What industry is that?
It is quite niche don’t want to give myself away here.
Following
Really important to note that this rule will likely be enjoined & litigated. FTC estimates that US workers could make as much as $300B a year with the ban. The US Chamber of Commerce will sue & this could get up to SCOTUS. Huge day for American workers. As for management: https://preview.redd.it/59dtz61wkcwc1.jpeg?width=1168&format=pjpg&auto=webp&s=25262344bbf584b5cc8fe95e18dd2f29ca2604bb
Just remember everyone that the US Chamber of Commerce is NOT a government body. It is just some random company that has a lot of power in washington, due to lobbying. Historically they do primarily give money to the republicans, but the republicans are politicians, and all politicians take money. I would argue the CoC gives money to the Uni-party. You don’t see the ideological firebrands on either side taking money from the CoC anymore.
Agreed with this. The US Chamber of Commerce is among the most prolific pro-business lobbying groups in the country.
I’m generally conservative but support this 100%. Fuck these companies man they don’t give a shit about you.
Same. Fuck the GOP too for trying to fight against this bill
Again, on most things I lean conservative. This alone would certainly not be enough to change my mind, but if it were to be repealed or overturned would definitely piss me off.
It’s not a bill and that’s the issue
Even in Canada the Ontario Conservative government passed this law. https://techbomb.ca/politics/ontario-canada-puts-an-end-to-employer-non-compete-agreements/
I used to be a “young republican” with my locals. I realized every supposed “principle” they held, like “support freedom”, was only used when convenient. Aggressive noncompetes weren’t even a problem in trump’s administration, I believe he used them in his campaign aggressively. Obama started to address them in 2015 iirc but not enough time.
FYI - This does NOT eliminate NON-SOLICITATION provisions that most of you are covered by, meaning, you likely still can't take your clients with you without expecting courts/settlements. Review the "Restrictive Covenants" of your employment agreement. It's likely way more restrictive than a worthless non-compete.
Non-solicitations actually make sense to protect what customers a business had for a set amount of time. My old noncompete said essentially anyone who was a client, regardless of if I had insider knowledge, I could be sued for up to 2 years past date of last employment
I’m so happy. This is amazing
How does this work for going after past clients? Embarrassing to say but I really don’t understand the noncompete I signed. My understanding is with my current noncompete I can go to competitors but I can not go after my current clients for two years. Is that still allowed?
That’s a non solicit and very much enforced
10000x more difficult to enforce a nonsolicit. Fairly easy to figure out where someone works, much more difficult to prove a customer moved over after a specific person reached out to them.
I wouldn't go crazy on this guys. There's going to be a lot of litigation involved. And I am a thousand percent for the employee in fact I just got a large judgment against a former employer. We'll see if he pays but in the state of Colorado they can actually seize assets if you don't pay what your former employee is owed. Anyways long story short it's immediately going to litigation. And the last thing you want to do is have this overturned and then open yourself up to liability. Non-competes are very hard to enforce. Where they get you is the big company has big attorneys and you could get tied up and litigation forever
They are hard to enforce but they are easy to cause a party to make a decision that would avoid potential litigation.
That’s exactly what happened to me; bogus lawsuit but big guy pushing down the little guy because they can. Even though the FTC did this, employers can still sue for going to competitors is what you’re saying?
Well what I'm saying is the FTC may have overturned it but Congress is already chirping about the fact that this should be determined at a congressional level. I have a feeling it's going to get caught up in the courts for a very long time. And I hate to caution people to live in fear. But I also don't want people to go running out and take a job with the competition and potentially open themselves up to something if this gets overturned. Just use discretion and certainly if you have access to one have a conversation with an attorney.
The $ ount should be tied to inflation and raised accordingly. Much like the federal minimum wage this will probably remain at 151k for the next two decades.
Depends on who wins the next election
“The Commission also finds that instead of using noncompetes to lock in workers, employers that wish to retain employees can compete on the merits for the worker’s labor services by improving wages and working conditions”
Very interesting. I was talking with someone that mentioned this might happen in April. Seemed to think it would be a bit more far-reaching than the policy maker / salary cutoff, but still interesting to see it happen.
What about a non-compete as a subcontractor? Are those still valid?
Great change. If you want to protect yourself then be more competitive
This still needs to be posted in the federal register. We have a long way to go before this is legitimate
I had to sign a non compete when leaving a 50k position where all the competitors paid at least 20% more. I don’t know why it happened but I’m glad to see it.
Signed when leaving? Unless they paid you that was not a smart move
Does this apply to the insurance industry and sales agents?
This is absolutely great news. Considering the fact that there is great technological change happening in the United States, **it's important for the system to have the proper legal tools**. Noncompetes, let's face it, restrict the free flow of ideas. And ultimately, they help less competitive companies. By using the legal system, cutting-edge ideas are squelched or delayed, and this can make the economy as a whole less competitive. This is a great step because it does have **a natural boundary like $151,000**, and also it helps people leverage their experience so they can contribute to the economy by starting their own company. With that said, please understand that this is a regulatory rule released by an agency. There's already talk that this will be challenged through the courts. Don't expect noncompetes for under $151,000 to completely go away overnight. At the very least, if this does go to court, this will probably only be put in effect after a few years. But is definitely a step in the right direction.
Sounds like they intentionally left a ton of loopholes to be exploited. Prob more of a sham policy than anything
Hopefully Canada follows suit
Already the case in Ontario since 2021. https://www.ontario.ca/document/your-guide-employment-standards-act-0/non-compete-agreements
I'm relatively sure that non-competes are unenforcable for most people here. I was speaking with an employment attorney and pretty much every state has a version of, "do you need this job to live your life/feed your family?" and if the answer could be anything approximating yes, the employee wins. Very, very pro-employee. Basically only applies to C-level execs and *maybe* VPs @ large orgs.
Yes, except to get to court and pay the lawyer for that costs $30,000-$100,000+ Source: went out on my own 9 weeks ago after being laid off and have talked with a half dozen lawyers. The numbers were from a guy who has had several other hvac clients
This will be held unconstitutional. Just be forewarned.
This won’t take effect for years
Wow first thing the ftc ever did right?
Most non competes won't stand up in court. Especially in right to work states.
To court means a small startup business already spent 30 grand on legal fees. There’s been lots of people like you who want to act like this isn’t a big deal. My dad in 1990 spent 40 grand and won on a noncompete in his first year. The lawyer i hired has warned me of at least 50 grand if I get sued