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The fact that different jurisdictions (states & countries) have different enforcement rules regarding this means that the objectivity behind this is not very clear. |
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A full answer to this requires a knowledge of contract law, but the moral principle here is that a contractual agreement is binding. A non-compete clause is part of an agreement between an employer and an employee. It recognizes that an employee, after working for a particular company, has intimate knowledge of that company's processes and methods, and so represents a competitive threat if he leaves the company and immediately works for a competitor. A non-compete clause requires a "cool-down" period between employment, requiring an employee, on leaving a company, for an amount of time, to not work for a competitor. It's a simple requirement of an employer on an employee, and there's no reason at all why non-compete clauses should not be allowed in employment contracts. Opponents of non-compete clauses cite that "a man should be free to work for whom he chooses". To which I answer: ". . . if he has not contractually promised to some party, to limit his own employment choices." More fundamentally: if you sign a contract, you must adhere to its terms, assuming it is a valid contract. As far as I know, there are two things which can make a contract intrinsically invalid:
In other words, you can't sell yourself into slavery, and if you enter into a contract where you make a promise, but get nothing in return for it, you are not legally obligated to keep your promise. Every contract involves a limitation on the behavior of both parties, because a promise is a promise to behave in a particular way. There is no reason why a promise not to work for a competitor for some amount of time after termination would invalidate a contract. What if the NCC is overly broad? e.g., "I will not work for another software company for X years." It's not slavery and you did get compensated by being hired. It's up to you, as employee, to decide what is too broad for you. You shouldn't sign the contract and then try to get out of it. You should simply not sign the contract. If a company required truly over-broad NCCs before hiring someone, ones that severely limited a person’s ability to gain a living (which is the straw-man that opponents of NCCs always trot out), then what rational person would work for that company? Such NCCs simply would not exist, or at least only for as long as it took for such irrational companies to go out of business. The labor market would quickly work out what sort of terms are "reasonable" to both employers and employees. Have you ever signed a contract without reading every word of it? I think almost everyone has. Maybe not an employment contract, but "if you sign it, you must adhere to its terms" is vastly overstating things, and adding "assuming it is a valid contract" just makes the statement vacuous (for some value of "must", anyway). To wit, there are more than two things which can make a writing (if it isn't valid, it isn't a contract) intrinsically invalid. I'm not sure this is the place to teach contract law though. Furthermore, it's not even clear what "The contract contains a promise to abrogate one's individual rights." is supposed to mean. It is quite common for a contract to include a promise to forbear from exercising a right. In fact, this is one of the primary ways to show consideration (which seems to be what you are referring to by "compensation"). And "sign" seems to be shorthand for "manifest assent". But has someone who signed a writing which they obviously either didn't read or didn't understand, manifested assent to that agreement? Even after you get through those hurdles there is the important question of what courts should do upon breach. Even if a non-compete is enforceable, the question still must be answered as to how to enforce it.
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