Before You Sign
Welcome
Noncompete agreements have been around for years, but they seem to be experiencing a surge in popularity. Employers love noncompete agreements because they reduce the power of the employee to bargain for higher wages. Interestingly, noncompete clauses should really be anathema to both so-called conservatives (because they interfere with competition) and so-called liberals (because they diminish the rights of workers), but they seem to have taken hold throughout the developed world, and most governments appear unwilling to confront the problem in a comprehensive way.
Dear Reader,
Noncompete agreements have been around for years, but they seem to be experiencing a surge in popularity. Employers love noncompete agreements because they reduce the power of the employee to bargain for higher wages. Interestingly, noncompete clauses should really be anathema to both so-called conservatives (because they interfere with competition) and so-called liberals (because they diminish the rights of workers), but they seem to have taken hold throughout the developed world, and most governments appear unwilling to confront the problem in a comprehensive way.
To be fair, noncompete agreements do have a purpose in this world. A company might make a huge investment in finding an upper-management exec, who is well compensated for any contract restrictions and whose departure could truly make chaos for corporate strategy. Sales staff sometimes have access to customer lists and other valuable information that the company has an interest in protecting from competitors. But the use of noncompete agreements has spread well beyond these special cases. A recent article in Bloomberg [1] quotes a 2014 study [2] that found nearly one in five workers in the US were bound by noncompete agreements, including in jobs such as camp counselors, night watchmen, and other gigs where the clause serves no constructive purpose other than to take power away.
Anyone can put a noncompete clause in a contract, but the enforcement of the clause depends on the jurisdiction. The different countries of the EU all have slightly different rules. In the US, different states have different statutes and common law provisions that define the enforceability of noncompete agreements. Most states have a general tolerance for noncompete agreements, although California, high-tech mecca of the USA, takes a hard line in prohibiting noncompetes, and a few other states have acted recently to limit the power of noncompete agreements, especially for hourly workers.
If you're on a career path in the IT industry, you might find it difficult to avoid noncompete agreements (unless you move to California). But if you're facing a contract negotiation, it is important to come armed with information, because information is power.
The first thing to know is that the noncompete clause in your contract might not be enforceable in your jurisdiction. (Check into this – don't take my word for it!) It is also a good idea to stop and consider who you are bargaining with. A big company like IBM or Oracle probably has a standard contract, hammered out by a team of lawyers and tailored precisely to the company's needs, and it will be difficult to get them to make a lot of changes just for little ol' you (although you could always try). A smaller company, however, might be using a boilerplate contract, with a few customizations by a local attorney, and they might be more flexible about changing the terms.
Some employers might balk at striking out the noncompete clause completely, but you might be able to talk them into reducing the duration or scope. For instance, if a clause tells me I can't go work for another magazine, I might be able to negotiate a refinement that specifies I won't work for another Linux magazine, and the employer might decide that their interests are adequately protected.
And of course, as any good negotiator will tell you, anything you give up should be worth something. If you're going to surrender the possibility of future professional mobility, you should let your future employer know that you know you are giving something up, which should be reflected somehow in the compensation.
This sounds like ivory tower stuff – easy for me to say and maybe not so easy to get an employer to accept. The important thing is, the non-complete clause is something to pay attention to – it's not one of those obscure trailing paragraphs stuck in at the end of a contract for no foreseeable purpose. It could have big implications on your future employment, so tune in before you sign.
Joe Casad, Editor in Chief
Infos
- "Too Many Workers Are Trapped by Non-Competes": https://www.bloomberg.com/opinion/articles/2018-11-12/non-compete-clauses-trap-too-many-american-workers
- "Noncompetes in the US Labor Force": https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2625714
Buy this article as PDF
(incl. VAT)
Buy Linux Magazine
Subscribe to our Linux Newsletters
Find Linux and Open Source Jobs
Subscribe to our ADMIN Newsletters
Support Our Work
Linux Magazine content is made possible with support from readers like you. Please consider contributing when you’ve found an article to be beneficial.
News
-
Fedora Asahi 40 Remix Available for Macs with Apple Silicon
If you've been anticipating KDE's Plasma 6 for your Apple Silicon-powered Mac, then you're in luck.
-
Red Hat Adds New Deployment Option for Enterprise Linux Platforms
Red Hat has re-imagined enterprise Linux for an AI future with Image Mode.
-
OSJH and LPI Release 2024 Open Source Pros Job Survey Results
See what open source professionals look for in a new role.
-
Proton 9.0-1 Released to Improve Gaming with Steam
The latest release of Proton 9 adds several improvements and fixes an issue that has been problematic for Linux users.
-
So Long Neofetch and Thanks for the Info
Today is a day that every Linux user who enjoys bragging about their system(s) will mourn, as Neofetch has come to an end.
-
Ubuntu 24.04 Comes with a “Flaw"
If you're thinking you might want to upgrade from your current Ubuntu release to the latest, there's something you might want to consider before doing so.
-
Canonical Releases Ubuntu 24.04
After a brief pause because of the XZ vulnerability, Ubuntu 24.04 is now available for install.
-
Linux Servers Targeted by Akira Ransomware
A group of bad actors who have already extorted $42 million have their sights set on the Linux platform.
-
TUXEDO Computers Unveils Linux Laptop Featuring AMD Ryzen CPU
This latest release is the first laptop to include the new CPU from Ryzen and Linux preinstalled.
-
XZ Gets the All-Clear
The back door xz vulnerability has been officially reverted for Fedora 40 and versions 38 and 39 were never affected.