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

416 points throwarayes | 1 comments | 21 Jun 25 16:02 UTC | HN request time: 0.286s | source

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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coderatlarge ◴[21 Jun 25 20:21 UTC] No.44340472[source]▶
can you choose to refuse these payments to avoid the responsibility?
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whiplash451 ◴[21 Jun 25 20:39 UTC] No.44340580[source]▶
I’ve seen this is France and UK but it lasts only a few months and no you can’t refuse the payment - but the company can refuse to pay and set you free.
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v5v3 ◴[21 Jun 25 22:26 UTC] No.44341185[source]▶
In UK it's called gardening leave. A period when you are still employed but not at work and can't join another company without agreement.

Uk law generally is that non compete clause is ok, if the length of time is reasonable. But you can't stop a person with a trade from applying that trade unreasonably.

Most tend to be 3-6 months.

Normally it's to stop a person leaving from stealing clients.

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kelnos ◴[21 Jun 25 23:46 UTC] No.44341571[source]▶
US finance has the same thing, and also calls it gardening leave. In our case I think it's reasonably common for it to be as long as a year.

Downside for finance folks is that the usually make a decent chunk of their compensation through bonuses, not their base salary. So their gardening-leave pay ends up being quite a pay cut, and while they're "gardening", they're out of the game for a year and their skills/knowledge becomes a little out of date.

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throwaway2037 ◴[22 Jun 25 02:04 UTC] No.44342638[source]▶

    > reasonably common for it to be as long as a year
Absolutely not. For ibanks, less than VP is one month. VP/ED/MD is three months. Sometimes it is six months for an MD, but that is extreme. The longest that I ever heard was someone who left Citadel as a portfolio manager had a TWO year gardening leave. How can that make any financial sense for Citadel? Before the HN crowd jumps in about that Citadel example being "reasonably common": There are probably less than 1,000 people globally who would fall under such an extreme contract.
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1. coderatlarge ◴[22 Jun 25 07:24 UTC] No.44344690[source]▶
for senior people whose alignment an employer needs to maintain after separation, it seems a lot more common to use some sort of advisory or consulting contractual relationship to keep them close as long as necessary…