Originally Posted by hmurchison
Really. Since this is the US what laws in particular are you referencing? Employment law is pretty gray with regards to what rights a former employee has. In fact many states will likely start ruling that non-competes are unconstitutional. Which in a nutshell means that if an employer cannot make an oath to abstain from working in a similar field a requirement of employment it stands that an ex employee would be bound by even more tenous strings to the former company. IBM has no case.http://www.sfgate.com/cgi-bin/articl...BUUH12716R.DTL
In a unanimous decision, the justices said state law since 1872 has forbidden what are called noncompete clauses that restrict management employees' options after they leave a company.
Nearly every other state allows such agreements, said Richard Frank, a San Francisco lawyer who has represented companies on both sides of the issue.
The ruling "advances the strong California policy favoring open competition and employee freedom," said Frank, who was not involved in the case. "Those have been drivers of the state's economy, especially in the technology area."
IBM will claim victory but they've had none.
California? Different country. At least they think so.
As I previously wrote:
I would doubt that there is a single Fortune 500 company that doesn't have their management, especially those in R&D, Market/Planning and Financance/New Product Development contracted without a non-compete clause.
Certainly, shareholders in particular would be highly hesitant knowing that top R&D personnel could simply walk out the door and go across the street to the competition at a drop of the hat.
Heck, "Non-compete clauses are everywhere from restaurants and their chefs to basketball teams and their coaches."* Probably the biggest corporations that are very tight on NCC and NDA are those that do contract work for the Federal Government, especially defence contractors. And even the Feds themselves have a similar and even more binding agreements which are virtually holding for the rest of one's life.
What IBM is doing here is simply ensuring that its (company and shareholders) property rights are being protected. Papermaster got an offer he couldn't or didn't want to refuse. Apple did nothing wrong by offering the position. Surely Apple understands and agrees to the principle of NCC's as they themselves employ their use. As such, Papermaster's employment from IBM to Apple would be conditional. However, it should be noted that Papermaster may have forgotten his commitment (as it was a long time ago) or his understanding of it did not appear to conflict with the position he was being hired for. In either case, it was simply decided to let the ball fall were it may, and if need be, let the courts decide it a foul was committed.
For those who are in the position to have to sign a NCC, the rewards for doing so virtually keeps them out of the poor house. This does not fall in the realm of servitude or "you can't keep me from enjoying a livelihood." However, the treatment of such depends on where you are, the conditions it covered and the intent to which the move is being made in the first place.
Here is a good site to help explain Non Competition Agreements.
"We have all heard urban myths - crocodiles attacking people in sewers; Jimmy Hoffa buried under Giants' Stadium in New Jersey. They sound real, but they are not. The distribution industry has such an urban myth. The myth is that non-compete clauses in manufacturers' representatives' contracts can be ignored because they do not mean anything. That statement is false. In almost every state, a tightly drawn non-competition agreement will be enforced by the courts. Even if the non-compete requirements are overly broad, the courts in many states will narrow them in order to enforce what the court feels is proper."
Perhaps this free article "Protect Trade Secrets from a Corporate Raid" will help to a better understanding. http://findarticles.com/p/articles/m...s_/ai_59579692
In any event, just wish that you get to be so presented with the opportunity. It can be a great negotiating tool. If they want you bad enough to consider your position that valuable, it obviously can raise the bar on all sides.
Another thing to consider. If you decide to dishonour your NCC, particularly if you were skipping to a major competitor and lied about it, just wonder how many companies would want to take a chance and hire you after that.
Again, non-compete clause are part of every major sports franchise, pharmaceutical companies, and automobile manufacturers, etc. Biggest user of all is the Federal Government agencies and its contractors. If you don't think that employees of Boeing, Lockheed, Northrop Grumman, etc., are immune to NCCs you need your head read. Apple understands it well. Afterall, they like most companies, employ NCCs routinely when contracting their top employees, manufacturers and outside agencies.