New York governor vetoes bill that would ban noncompete agreements
New York governor vetoes bill that would ban noncompete agreements
New York Gov. Kathy Hochul has vetoed a bill days before Christmas that would have banned noncompete agreements, which restrict workers’ ability to leave their job for a role with a rival business.
New York’s governor vetoed a bill days before Christmas that would have banned noncompete agreements, which restrict workers’ ability to leave their job for a role with a rival business.
Gov. Kathy Hochul, who said she tried to work with the Legislature on a “reasonable compromise” this year, called the bill “a one-size-fits-all-approach” for New York companies legitimately trying to retain top talent.
“I continue to recognize the urgent need to restrict non-compete agreements for middle-class and low-wage workers, and am open to future legislation that achieves the right balance,” she wrote in a veto letter released Saturday.
The veto is a blow to labor groups, who have long argued that the agreements hurt workers and stifle economic growth. The Federal Trade Commission had also sent a letter to Hochul in November, urging her to sign the bill and saying that the agreements can harm innovation and prevent new businesses from forming in the state.
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195Why the fuck do they even need a non-compete clause for a sandwich shop? Are they worried people are going to reveal their secret Jimmy Johns technique for putting salami on bread to Subway?
96The myth of the non-skilled worker isn't working in their favor here.
43It's legal for them to do so, and if employees can't go to a competitor, it has the effect of depressing wages.
Non-compete clauses make sense for certain higher level employees (and usually involve some sort of garden leave payment too) but corporate America has started to slip all sorts of bullshit into standard employment contracts just because they can.
26I mean you joke, but that actually happened by me lol
There is a hero shop that is well known for specific heros they make that are really good, so after they fired a guy who worked there for years and years he opened his own shop and took all their recipes plus added pizza. (He also hired someone to make pizza and then fired him after he learned how to do it. He's just a scumbag lol)
6It isn't about need, but about want. Every extra notch of control they can get over workers employment opportunities, they want.
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Fun fact, there are franchise owners for all the big names that do this. McDonald's, Pizza Hut, etc. It's not usually a corporate decision.
Related, there are chains that won't hire from each other. They maintain a gray list of previous employees and you can only get hired back at your original location.
9Ah yes, workers might take those precious trade secrets of (checks notes) how to make a sandwich.
9Not slavery, serfdom.
Which is technically better then slavery for the serfs, but conveniently is also significantly cheaper for the landed gentry/capital class as they don't have to feed or house their serfs.
7Why do you think political bribery is so rampant and expected in the US?
Our politicians are almost exclusively paid middle managers for the owners. DC works for Manhattan and Silicon Valley.
3
Why do these companies never get it? You want to retain talent… you gotta pay to retain that talent.
More accurately, you want your experienced and proprietary-knowledge-laden people to not take that stuff elsewhere…. Gotta pay them what they’re worth.
Can’t keep lowballing the pay raises, and expect people to not shop around,
156Sure they can, so long as they can ensure they have a high-placed government stooge or two to ensure they can legally blacklist an employee from the industry if they leave.
55He who lives by the free market shall die by the free market
14That's the thing though. They don't want to best talent. That is the point. You have to pay for talent. Talent tends to rock the boat and has the power to spark change because the company becomes reliant on them.
Most companies are completely fine paying much less for mediocre workers who will keep their head down and deliver a mediocre product where the execs get a way better profit margin and can perpetuate toxic systems.
8Why do these companies never get it? You want to retain talent… you gotta pay to retain that talent.
Oh, no, that fact is exactly what they pull shit like this. They HATE that fact and will pull any underhand tactic to fight back against it. Noncompetes, union busting, collusion, monopoly building, whatever it take to pay their employees the least amount possible.
6
companies legitimately trying to retain top talent
Basically blacklisting them from their field for a year after leaving your company is not how you retain talent. Pay them better. Give them better health coverage or other benefits. Only being able to retain talent by basically threatening them if they leave is not a good look.
122knew a guy who crossed out those bits in the agreement. they HR peeps never noticed until he found a new place to work. (he now works for our company.) It amazes me; how many people fail to realize every contract is unique.
45
Cute how she's being likely being paid under the table by some lobbyists that benefits from said non-compete agreements. And even if not under the table, it's likely under the form of campain contributions, etc. Politics and capitalism mixed together brings the worst in both.
Nobody in their right mind would elect to veto something giving more rights to the working class without having some personal interests on the line.
109You have a source for that?
-56Here is a source for you.
We are a oligarchy
22Here is a source for you.
We are a oligarchy
1
You picked the wrong side, Governor.
71And this is one of the reasons top tech talent stays in Silicon Valley / San Francisco, and why that area innovates so quickly.
If your company sucks, I’ll work for your competitor.
58It's also why wages are so high. You wanna keep your talent? You gotta pay more than the company next door, or have better perks to make up for the wage disparity.
I got poached from AWS because my current team has a full AWS stack, and they wanted someone who knew it inside and out. They offered me a full remote position (whole company is full remote) with a higher salary, but slightly less TC. My new job is also way less stressful and with way more freedom.
37
Why can't they retain top talent by paying them more?
57But how would that benefit the shareholders? You're not thinking like a true capitalist!
18Hahahahahah
6
How are contracts like this enforceable in the US? Like here you could have a clause like that but the moment you try to sue someone for working at a competitor the judge would just laugh at you and throw your ass out of court. You can't have just anything in a contract, just like if a contract breaks employment laws then it's not valid.
44Most contracts have a severability clause saying if any clause is unenforceable then that clause shall be severed, but the rest stands. This lets companies take some big swings with what they put in there.
It takes time and money and stress for a worker to challenge any terms regardless of their merit. So an invalid contract still keeps you down, just not as strongly as the invalid contract itself claims to be.
32They are rarely enforced and when they are it is usually due to some sort of significant financial loss the company suffered. Normally a company is not going to waste time and money taking a cook or cashier to court over quitting a job at McDonald's then going to work Burger King. But a senior software engineer working at Google going to work for Apple could have some real financial implications, so they'd be more likely to pursue legal action against that person. Still kinda bullshit in my mind but I get it.
11Yeah but California has already banned non-competes, has for years, and Google and Apple seem to be doing just fine with the financial implications.
Also non-competes are different from NDAs.
20But a senior software engineer working at Google going to work for Apple could have some real financial implications
No, unless you mean something quite different than that title. A large company will have hundreds or even thousands of senior software engineers, and it’s really not something that should be restricted with non-competes
To be valid, a non-compete should:
- be subject to contract law, not just imposed
- include recompense
- not prevent you from getting a job
- be narrowly tailored (ie, not prevent someone from working)
- limited duration
- can only apply to a few where the impact can be described or quantified: founders, executives, celebrities, top sales people with same customers
7There's still protections. Apple just got rocked for stealing the entire dev team from somewhere and just wholesale copying the code. Which is on Apple, not the worker. They could absolutely have taken them for an adjacent project (it was sensors in smart watches) using the same sensors. Or paid a licensing agreement for what was there with a right to improve it.
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They don't have to actually enforce it, they just have to scare you with it. Or better yet, convince you they could enforce it
6
legitimately trying to retain top talent
"Trying to figure out how to pay their talent less"
42If you want to retain top talent, pay them, give them better working conditions, offer them fulfilment. Don't make it illegal for them to work elsewhere.
We need free markets and deregulation... until it inconvenieniences non-productive shareholders in the slightest or those dirty workers start getting a little uppity.
25In California, non-compete agreements are banned unless the company compensates the person subject for the agreement. If the company can impose one for free, why not subject everyone to them?
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Related. My previous employer had a b2b non-compete. The clients couldn't hire me. Yes it did end up costing me a job and a lawyer told me it would be very dicey challenging it the way it was written. On the plus side the client went bankrupt a few months back so that would have sucked.
23Asshole.
21Any chance of overturning the veto?
20From this photo, this woman looks like the baddie from Men In Black 2.
18The funny thing is then the rich companies spends millions on lawyers to say that poached employee's stuff was common knowledge and thereby not an NDA issue or trade secret.
You turn around and say I'm leaving but will say the same stuff that person said to the next employer and they'll sue with the same lawyers.
"It's ok if I do it but not if they do it"
15Aren't non competes generally very difficult to enforce? The people I've known that have gotten in trouble with non compete agreements are those in management positions that engaged in very active poaching of their old teams within a specified time frame.
Also, given the nature of remote work and hiring, I kind of have a mixed feeling. What does this kind of state regulation in a VHO/WFH environment do to NY workers in a job market with flexible location? These regulations really should be at the federal level.
8If I could just leave my current company and go to a different company that did the same thing it would be good for me if I wanted to move or make more money. The other company would probably not really make that much money.
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1Non-competes for top tier jobs make sense, as the company invested a lot of money into the person and it wouldn't be fair to have them poached for no cost by a rival. All tech companies make software engineers sign non-competes.
-7as the company invested a lot of money into the person and it wouldn’t be fair to have them poached for no cost by a rival.
They are employees, not indentured servants.
The financial risk should be on the corporation, and not on the employee. Corporations are the ones that are going to make the most money, between the two.
15All software engineers do NOT sign non-competes. I've been in the field for 25 years...closest I ever signed was a NDA
1I'd argue that big tech doesn't invest in its workers because they look for top-tier candidates already. Also, it is way too easy for companies to abuse non-competes. People shouldn't be forced out of their industry because they left a bad employer.
1
So what else was in the bill that got it vetoed? They always hide some egregious nonsense in bills like this so if it gets vetoed they can point the finger and create outrage.
-11She states it in the article. She believes companies have a "right" to retain high end labor. This bill just straight up bans non compete agreements which would make it harder to retain well trained, experienced, professionals.
That said. Why in the fuck love did we ever decide it was okay to threaten someone's livelihood for leaving a job? I don't care how highly trained you are. Non competes are anti-competitive in nature. They should have never been allowed.
22Nothing that I can see. Read the bill.
https://www.nysenate.gov/legislation/bills/2023/S3100/amendment/A
10Thanks for the link. That's worse than I thought, then. Wow.
1/u/Lev_Astov@Lemmy.world didn't even make it to the third paragraph of the article, I don't think that they'll read the bill.
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Nothing just money paying a governor for her veto
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