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Tell HN: Beware confidentiality agreements that act as lifetime non competes

416 points throwarayes | 6 comments | 21 Jun 25 16:02 UTC | HN request time: 0.534s | source | bottom

Just a note of warning from personal experience.

Companies don’t really need non-competes anymore. Some companies take an extremely broad interpretation of IP confidentiality, where they consider doing any work in the industry during your lifetime an inevitable confidentiality violation. They argue it would be impossible for you to work elsewhere in this industry during your entire career without violating confidentiality with the technical and business instincts you bring to that domain. It doesn’t require conscious violation on your part (they argue).

So beware and read your employment agreement carefully.

More here https://www.promarket.org/2024/02/08/confidentiality-agreeme...

And this is the insane legal doctrine behind this

https://en.m.wikipedia.org/wiki/Inevitable_disclosure

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tianqi ◴[21 Jun 25 19:56 UTC] No.44340313[source]▶
I think the Chinese law is effective in this regard: in order to maintain any non-competition agreement, the company must continue to pay you a monthly compensation amount equal to 30% of your total monthly income when you were at the company. Whenever the payment stops, the non-competition agreement is automatically void.
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schmichael ◴[21 Jun 25 22:56 UTC] No.44341352[source]▶
Oregon at least makes it 50% IIRC. Anything less than 100% seems useless though. Usually when taking a new job in the same industry you expect a pay bump, so even a 100% rate is likely leaving money on the table.
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Sharlin ◴[21 Jun 25 23:51 UTC] No.44341601[source]▶
Well, yes, but you don't have to work.
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hippari2 ◴[22 Jun 25 02:08 UTC] No.44342668[source]▶
More like you are not allowed to work. Loss of work experience, loss network, not even accounting for inflation.
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bigiain ◴[22 Jun 25 03:00 UTC] No.44343054[source]▶
I would welcome an opportunity to walk away from the entire tech industry with a guaranteed-for-life income, allowing me to pursue dreams without them needing to be financially viable. Setting up as a high end timber boat builder without ever needing to turn a profit while still having the same income I do now is something I'd jump at immediately.
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1. jaggederest ◴[22 Jun 25 04:47 UTC] No.44343733[source]▶
Plus, nobody says you can't work in any other field you like, just not whatever you used to do.

Net present value of 50% of salary for the next 30 years is something like a million dollars for most HN commenters, I'd guess.

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2. bruce511 ◴[22 Jun 25 05:41 UTC] No.44344070[source]▶
Except it's not "for life". It's until they feel free to lift the non-compete. My guess is that most information you take from a company is irrelevant in a couple years. Maybe 5 tops?

Plus it'd almost certainly end with zero notice. You'd get a email saying "you're free to go". Suddenly. After say 26 months.

So it's not like a "pension for life" - just a gap in your employment history.

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3. jaggederest ◴[22 Jun 25 07:57 UTC] No.44344890[source]▶
Oh no, ah jeez, slightly more than one year of income for zero effort, darn.

Any employment gap can be easily explained by saying "I was under a non-compete and being paid garden leave while working on personal projects to keep my skills fresh". It's very common in e.g. the finance world, I believe.

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4. ghaff ◴[22 Jun 25 11:49 UTC] No.44346113{3}[source]▶
I suspect most people with that sentiment don't have a mortgage/kids/etc. I have known youngish people who got a very nice severance package back in the day and essentially took a 6 month sabbatical. I don't really see a problem for getting future jobs so much. But it is a loss of significant income (assuming you were well-compensated even if you're still being paid something) and may not have great alternatives for income though, if you're in the position to do so, you can of course travel or whatever.
5. bruce511 ◴[22 Jun 25 14:48 UTC] No.44347367{3}[source]▶
I've no argument with the severance cash, I'm saying that you can't just revert to a hobby because you have an "income for life."

The uncertainty means you're still out on the job market looking for a real job.

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6. ghaff ◴[22 Jun 25 20:42 UTC] No.44350117{4}[source]▶
There's perhaps significantly lower total compensation and potential uncertainty. A lot of people just aren't in the position to travel the world (or whatever) for a year. Or even work on an open source project that may or may not even be within the bounds of the non-compete depending in the company.