I had quite a bit of discussion about this for my current project. It had two non-competes; one for the client and one for the intermediary, and the important one, the one by the client, sounded very broad and vague, and I wanted explicit and in writing how broad they meant it. (Turned out to be only about a handful of their direct competitors.)
Make them sleep in the bed they make!
I'm curious, was there any actual legal action or was it just the threat? I'm not dismissing the fact that a threat can create enough risk to make someone change their behavior, but I've also heard these NDAs are tough to legally enforce. Of course, nobody wants to be the one calling their bluff only to find out it wasn't an idle threat.
One particular instance that stands out in my mind was for someone who I saw hired into the company for a specific role with a certain scope. The previous company's HR then sent a letter to the new company's HR telling them about the employee's obligations under the NDA. The new company's management decided the prospect of a legal issue was too much a hassle, so they reassigned the new hire to a different role outside their direct area of expertise and with a smaller scope for a year.
AFAIK, there was never really an opportunity for the employee to say, "No, don't do that, I'll shoulder any legal responsibility if the previous company decides to get nasty about this." The simple "it would be a shame if something were to happen" letter between HR departments was all it took to put the worker in a career tarpit for a year.
I showed up to a meetup at some tech company's offices. After putting in my name, I was shown a contract on a small tablet and was expected to click next and sign with my finger. I have normal vision and couldn't read it without putting it right in front of my eyeball. I don't sign anything without reading. I asked if they had a printed copy so I wasn't holding up the entire line.
Their response? "Oh, that's just all standard legal stuff, don't worry about it."
Easy to say when your lawyers wrote it. It turned out to include both a non-disclosure and non-disparagement agreement. I did not attend that meetup.
Funny enough, they didn't even follow the rules themselves. The "end test" protocol was to raise your hand in the testing room and be escorted out, I sat there for a few minutes then just walked out myself and apparently that's what I was supposed to do.
I'm a Canuck, so centuries of legal, common law separation here...
But if someone misrepresents what a contract is, and even more so applies pressure to sign, it's meaningless.
My understanding is that this goes back to "make your mark" and lower levels of literacy, and in modern times, that legalese is gibberish to many, thus misrepresenting what you're signing can effect enforcement/validity.
It's very stupid for them to brush it off like that.
(I wouldn't have signed either, and have walked from jobs and contracts over absurd NDAs. One client actually wanted me to sign a forever NDA, but 1/2 way through the contract! Wtf?! Negotiate that at contract sign, not months later!)
It would be fraud to misrepresent a material fact at time of signing, such as the quality of goods or, say, if a loan officer says that interest is fixed-rate, when the contract says it is variable-rate. But for my case, what does "standard legal stuff" actually mean? I'd argue it is actually pretty standard for a Bay Area tech company. What does "don't worry about it" actually mean? If I asked the receptionist to explain more or "does this include a non-disparagement agreement?", I doubt they would have said anything.
For proof, I was in California, which is a two party consent jurisdiction for recording. So I could have pulled out my phone and said "I'd like your permission to record what you just told me about the contract. Can you please state your name, position at Company X, and what you just told me about it being all standard legal stuff?" If I was that receptionist, I'd probably call security.
I had a prof in university who was pretty sure majority of them wouldn't stand up to an actual legal case.
The point isn't to lock you down, it's to try to lock you down, and to come off as intimidating or onerous.
You can also print it off, cross out the shit you don't consent to, initial the changes, sign, and mail it certified to whatever their address of record is. I'm not a lawyer, but at that point my understanding is it's their job to say no we don't agree, just like it was your job to say no I don't agree.
California rental agreements are a particularly odious example. Liquidated damages (AKA late fees) are completely illegal in California. In fact it's illegal to even present a lease that has a LD clause to be signed! Sometimes I wish I were more into small claims swashbuckling, because I bet you could have a dozen small claims for various properties going against Equity Residential in any California city.
In my jurisdiction predatory loans are unenforceable.
Oh good so it's no big deal if we just skip it
Like, honestly, I'm not going to subject myself to some legal encumbrance because of peer pressure. I got a bunch of pressure at a former employer where they wanted everyone to sign these new employment agreements and it took months because I wasn't getting sufficient answers to questions I had. I should have taken it as a warning sign of where they were headed based on how stuff proceeded there later on, but I was pretty young back then. :P
True private practices are definitely not doing that. they dont even have the financial incentive to make an investment for the legal advice add that statement, to their financial disclosure
There’s zero intent from operators to allow their users to understand what they’re agreeing to. It’s all legalese written for their convenience.
It’s ridiculous how flippant and deceptive companies are about signing non-competes. Sometimes they neglect to mention it until you actually show up for work. So there you are, depending on this new job, standing in front of your new boss, compelled to create and maintain a positive relationship, presented with a legal contract that significantly damaged your leverage and alternate prospects.
That might even be criminal.
Often, I hear from some about how non-competes in some states are “non-enforceable”. But even when that’s true it doesn’t inoculate you from serious problems.
A friend signed a non-compete regarding professional services when he want to work (as an independent contractor, mind you) and was sued by the company after he left. He lawyered up and won, but the case took 18 months due to stalling and delays by the company. During that 18 months the judge had granted an injunction preventing him from providing similar services, leaving him effectively unemployed. It did great damage to his savings and the strength of his resume, which now had a significant gap.
As I said, he won! But he was awarded no damages, despite the victory. Seeing this play out convinced me that even you’re in the right, the process can be plenty of punishment on its own.
Careful with that word. Non-competes are non-enforceable in California and other jurisdictions. Some people say "non-competes are illegal in California", but it is not a crime to ask someone to sign a contract with a non-enforceable provision.
But most of them aren't legally binding.
I've never understood why people care so much about these unenforceable non-competes. They want me to sign a contract that's inherently void? Sure, I'll do that all day (or if I'm feeling feisty I'll ask them for a small salary bump for the trouble - may as well take the free money right?). If they want me to witness them signing a deed to the Brooklyn Bridge I'll do that too.
I had a former employer sue a friend of mine, it wasn't legally enforceable but had to go for enough toncost enough in legal bills to make it so my friend lost his new, great, job that he had moved for. Just because it's not technically legally enforceable doesn't mean the company won't try to enforce it, and that trying has a real cost in terms of lawyers fees and also loss of employment.
I love my job, and I have a family, so the risk reward is too hard, but I’m literally going to quit in the next year just to get out of that stupid paperwork
[0] https://www.employmentlawwatch.com/2021/10/articles/employme...
The thing you have to realize about commercial contracts is that the law doesn't enforce itself, people who violate them usually don't get caught, etc.
Note also there are other inputs to NDAs. I worked for a firm that did a project for a big accounting firm that itself had confidentiality requirements to its customers so it is natural as an employee of the first firm I help the second firm keep its commitments.
I'd say there are two threads in NDAs: one of them is threats against those who violate confidentiality, another is a description of the procedures that are supposed to be used to protect confidential information. The last time I was doing a lot of consulting I had an NDA that had no threats but lots of guidelines.
They freaked out when I told them I didn't want to complete the interview loop because apparently I had passed their initial "weeder" interview and they were getting really excited about the possibility of me joining. But I would have had to sign that "everything, forever" NDA to keep going, and they weren't willing to go back to legal or do anything to change it, so that was that.
I personally know several people in my state who had their careers impacted due to threats from former employers over an NDA, so I really don't feel like that was an overreaction on my end. And I'm super-happy where I ended up.
I just wanted to provide a data point on how NDAs that go overboard ("everything, forever") can cut both ways.