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Speaker 1: Welcome to stuff you should know, a production of iHeartRadio. Hey,

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Speaker 1: and welcome to the podcast. I'm Josh, and there's Chuck

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Speaker 1: with me, and that makes this stuff you shouldn't Azzoh

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Speaker 1: that's right, mister dog. Yeah, man, what's that one song?

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Speaker 1: He had? A sensual seduction? What a great song that was.

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Speaker 1: I'm not sure if I know it. Would I know

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Speaker 1: it if I heard it? Probably, but it was like

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Speaker 1: kind of a weird synth dancy early eighties vibe, much

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Speaker 1: more than a rap vibe. He was just expanding out. Yeah, yeah,

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Speaker 1: that's Martha Stewart on it. No, which is kind of

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Speaker 1: surprising because I heard she got like a huge tattoo

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Speaker 1: of him. Really now, it was like a super Bowl commercial.

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Speaker 1: Didn't see it? Yeah she could have, though I'm a rube. No,

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Speaker 1: you're not, Chuck. You just don't pay enough attention to commercials.

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Speaker 1: Should we talk non compete agreements? Yes? I think we

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Speaker 1: should because they turn out to be rather onerous. Yeah,

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Speaker 1: possibly soon to be illegal, yay, and just kind of

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Speaker 1: scummy because, as you'll see, they're frequently used by big business.

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Speaker 1: But if you're a free market capitalist, you're not allowed

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Speaker 1: to like non compete agreements because it literally hobbles competition,

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Speaker 1: which is the point of free markets. And one of

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Speaker 1: the great things about competition is that you and me

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Speaker 1: and everybody else listening out there who doesn't own a

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Speaker 1: business and just buy stuff usually gets better prices, better products,

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Speaker 1: more innovation when there's greater competition. And non competition agreements

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Speaker 1: non compete agreements do the opposite of that. They stifle

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Speaker 1: all those things on purpose for the benefit of just

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Speaker 1: one company. It's right there in the name. They even

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Speaker 1: they gave away their hand when they called them no competes. Exactly.

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Speaker 1: It's pretty flagrant. It is. If you don't know what

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Speaker 1: we're talking about about. One in five Americans work under

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Speaker 1: an NCA, and a non compete is when and hopefully

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Speaker 1: you've never had to sign one of these. Hopefully you're

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Speaker 1: not one of the twenties percent of workers in the

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Speaker 1: United States. But if you are working under one, then

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Speaker 1: you know what it is. It's it's a thing that

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Speaker 1: you sign when you get a job. Usually when you

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Speaker 1: get a job. Sometimes they can come along a little

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Speaker 1: later in the job, if you get like a promotion

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Speaker 1: or something, but it's a condition of getting that job.

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Speaker 1: Most times that basically says, hey, if you work here,

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Speaker 1: you can't go quit your job and then go get

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Speaker 1: a job at another company that's a rival of ours,

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Speaker 1: or you can't run off. And like if you're a

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Speaker 1: if you're a vet, let's say, and you and you

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Speaker 1: help out doggies and kiddies and komodo drags or whatever,

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Speaker 1: you got to sign one that says, hey, you can't

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Speaker 1: go start up your own vet practice. And there's usually

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Speaker 1: a certain amount of time, like six months or three months,

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Speaker 1: or a year or two years generally where it caps off,

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Speaker 1: although I'm sure there's some really draconian ones that stretch

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Speaker 1: on for years and years. Yeah, I've seen five is

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Speaker 1: the highest i've seen, But I'm sure somebody's pushing the

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Speaker 1: mline five years. You can't go make a living and

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Speaker 1: doing what you do exactly, So you can hear by

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Speaker 1: the tone of my voice how I feel about these things.

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Speaker 1: I'm gonna try and be fair. I know you're you're

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Speaker 1: with me. We're pro employee. Yeah, also pro competition too,

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Speaker 1: but okay, go ahead. We're pro employee. So that's kind

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Speaker 1: of where our heart lies. We are employees, so that's

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Speaker 1: why that's where our heart lies. For the most part. Yeah,

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Speaker 1: but having said that, I do get in certain circumstances

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Speaker 1: why businesses draw these up at least as usual, Chuck,

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Speaker 1: I'm right there with you, totally agree. Should we talk

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Speaker 1: about these few reasons? Yeah, there's one other, there's a

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Speaker 1: couple of other things, just to kind of do the

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Speaker 1: outlines of these things. In addition to a length of time, usually,

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Speaker 1: like you said, that you're prohibited from going and working

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Speaker 1: for yourself or competitor, there's also sometimes geographical restrictors, which says,

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Speaker 1: you know, you can't work for a competitor in the

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Speaker 1: same state or something like that. Right, feel free to

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Speaker 1: move completely, upend your life and move time with us,

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Speaker 1: but you can't do it in the state. And then

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Speaker 1: one of the other times it pops up pretty frequently

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Speaker 1: outside of the corporate world, is when say you sell

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Speaker 1: a restaurant, you'll usually sign a non compete that says

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Speaker 1: you're not going to go down the block and create

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Speaker 1: the same restaurant again and compete with the one you

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Speaker 1: just sold, because you know, again, like you said, there's

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Speaker 1: some instances where it does seem okay, and yeah, let's

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Speaker 1: go over some of those. Yeah, one of them is

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Speaker 1: guarding trade secrets. I kind of get where they're coming from.

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Speaker 1: If you have a trade secret that's really valuable and

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Speaker 1: it's something that this company owns or thought up at

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Speaker 1: least or as the IP rights, do, I get why

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Speaker 1: company would not want to say, like, sure, just go

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Speaker 1: quit the job and take those secrets with you to

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Speaker 1: a competitor. Yeah. Like, um, do you remember when those

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Speaker 1: former Coke employees went to Pepsi and said, Hey, we've

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Speaker 1: got Cooke's recipe, you want it? It must have been

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Speaker 1: so surprised when Pepsi called Coke and said, hey, you've

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Speaker 1: got a big problem. That was pretty interesting. But yes,

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Speaker 1: I'm quite sure they signed all sorts of agreements that

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Speaker 1: they violated in doing that. Yeah, and we'll get into

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Speaker 1: the details later on. But you don't necessarily like you

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Speaker 1: can cover trade secrets with by other means rather than

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Speaker 1: just signing a noncompete as an employer. Right. What else? Well,

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Speaker 1: this one I kind of get to to a certain degree.

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Speaker 1: Companies oftentimes will make great investments in their employees to

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Speaker 1: keep them around. Like whether it's just the normal training routine,

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Speaker 1: which you know, I know from Emily just having her

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Speaker 1: small business, it takes a long time to get someone

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Speaker 1: really up to speed, and for someone to either not

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Speaker 1: work out by just organic circumstances or leaving shortly thereafter,

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Speaker 1: it's a big blow, especially to a small business. So

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Speaker 1: I get that. Or they may like further your education,

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Speaker 1: say hey, we'll put you through grad school or something

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Speaker 1: like that, but you got to come take that grad

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Speaker 1: school knowledge and help our business with it. Sure. The

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Speaker 1: point is that you don't want to invest a bunch

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Speaker 1: of time and effort and information into training and employee

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Speaker 1: and have them go take it to a competitor. Yeah,

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Speaker 1: I get that somewhat. There's another one. I'll bet you

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Speaker 1: get this a little less because I do too. Yeah,

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Speaker 1: Like I understand it, I just don't agree with it.

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Speaker 1: And that is to keep bases of clients right. So

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Speaker 1: like if you're if you are, if you cut hair

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Speaker 1: at a hair salon, there's especially depending on the salon,

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Speaker 1: but there's a really good chance that you signed a

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Speaker 1: non compete that says like you probably can't cut hair

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Speaker 1: in the same town right anywhere else. That's a pretty

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Speaker 1: prevalent from what I understand it. Like hair salons, there's

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Speaker 1: other places too that try them, like law firms, sometimes

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Speaker 1: try them VET clinics like you you recommended, But I

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Speaker 1: believe there's also some industries, including attorneys and fiduciaries, that

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Speaker 1: say it's too important for the client to be able

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Speaker 1: to choose exactly who they want for us to have

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Speaker 1: non compete, so they kind of customarily avoid them. Yeah,

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Speaker 1: this is you're on target, because this is the one

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Speaker 1: that I have the one of the most problems with

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Speaker 1: out of these three, because this basically says we can

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Speaker 1: kind of treat you poorly as an employer. Like if

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Speaker 1: you're let's say, if you're a hairstylist and you don't

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Speaker 1: like your situation, but you've got these clients who love

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Speaker 1: the way that their hair is getting cut by you,

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Speaker 1: but you've got some terrible boss. It's a bad agreement.

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Speaker 1: You should be able to go and have those people

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Speaker 1: follow you because they're not there because they like the

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Speaker 1: fit of the chair, right, you know, they're there because

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Speaker 1: they like the haircut that they're getting. Absolutely, it is

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Speaker 1: so hard to find a good hairdresser who charges a

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Speaker 1: reasonable rate. It's really important. I'm not joking right now.

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Speaker 1: I finally found my guy, and like, if he ever leaves,

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Speaker 1: I'm I'm in trouble the same thing with like a

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Speaker 1: dog groomer, Like we've lost dog groomers before, just gone

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Speaker 1: poof vanished. Then the people won't tell us what happened

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Speaker 1: to them or how to get in touch with them,

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Speaker 1: because they want us to stay there. And it's it's

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Speaker 1: you're not only hurting your former employee, you're also harming

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Speaker 1: your customers too, because you might be pairing them up

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Speaker 1: with an inferior dog groomer compared to the person who

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Speaker 1: just left. You know, yeah, I should shout out my

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Speaker 1: hairstylist because it's fairly recent, because I recently in our

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Speaker 1: Amorrow podcast talks about our friend Thomas, who is the

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Speaker 1: father of one of Ruby's friends. Thomas's wife and Ruby's

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Speaker 1: friend's mom is Robin and she is my friend and stylist. Nice. Well,

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Speaker 1: then she's great. I'll shout out Michael, my hair stylist.

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Speaker 1: And if they went to you know, if Robin decided

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Speaker 1: to go to another place, I wouldn't be like, No,

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Speaker 1: I'm really super loyal to the walls of that building

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Speaker 1: that I was in, right, No, I'd follow Robin where

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Speaker 1: she went. Yeah, I agreed, totally. I'd follow Michael to

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Speaker 1: the ends of the yearth So there's another way to

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Speaker 1: look at all this stuff too, Chuck, You're ready. Yeah.

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Speaker 1: People who are pro non disclosure agreements say that these

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Speaker 1: things work in the non competes you mean, yeah, yeah, sorry, man,

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Speaker 1: I just gave away something we're gonna talk about later.

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Speaker 1: People who are in favor of non competes say that

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Speaker 1: the opposite holds true too, where if you take away

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Speaker 1: non competes, then companies might be less willing to invest

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Speaker 1: in their employees because they're going to, um, you know,

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Speaker 1: possible walk off. Um. Yeah, that's that's probably the best

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Speaker 1: argument they have against them. But it's very similar. I

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Speaker 1: was trying to think of an analogy, and the best

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Speaker 1: I could come up with is saying, like, because there's

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Speaker 1: a chance that some of our guys are going to

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Speaker 1: strike out, we're just not going to play baseball, right,

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Speaker 1: you know what I mean? Yeah? Yeah. And then if

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Speaker 1: the whole inherent unfairness of a non compete agreement, by

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Speaker 1: the way, like all the all the pros are done now, Um,

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Speaker 1: if it hasn't become clear yet, you can if you

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Speaker 1: take the business out of it, it becomes much clear. Right,

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Speaker 1: So if you look at your employment between a worker

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Speaker 1: and an employer as a relationship, like between a boyfriend

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Speaker 1: and a girlfriend or something like. If you break up,

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Speaker 1: it's like the boyfriend saying you can't date anybody for

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Speaker 1: a year, or you can't date anybody in this state

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Speaker 1: for a year. Go ahead and move up, end your life.

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Speaker 1: That's fine, but no one in this state you can date.

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Speaker 1: And then it can get yes, that's that's a great point,

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Speaker 1: and then it can get even worse. The boyfriend can

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Speaker 1: dump you and still say you're not allowed to date

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Speaker 1: anybody for a year. Right when I thought of it

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Speaker 1: like this, like I already knew they were inherently unfair,

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Speaker 1: but it really kind of settled in, so I wanted

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Speaker 1: to share that with everybody. That's good. What's interesting, especially

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Speaker 1: when you look at the example of like a hairstylist,

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Speaker 1: is chances are that hairstylist was already a good hairstylist

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Speaker 1: when they started working for that place, and it wasn't

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Speaker 1: kind of how these things started out, which is, you know,

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Speaker 1: segues into the history where you I don't know anything

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Speaker 1: about cutting hair, and I'm just gonna apprentice with you

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Speaker 1: for a while, and you're going to teach me everything

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Speaker 1: I know about how to cut hair, like that's a

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Speaker 1: little more understandable. And that's at least in England. That

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Speaker 1: was the history of non competes was in fifteenth and

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Speaker 1: sixteenth centuries. The way it was set up was there

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Speaker 1: were you know, master craftspeople and then they had apprentices

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Speaker 1: working for them and they would teach them their trade

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Speaker 1: and in turn get a lot of work out of

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Speaker 1: this person, and then they could go on and try

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Speaker 1: to become a mastercraftsman themselves, start up their own you know,

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Speaker 1: habitash or shoe shop or whatever. And early on in

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Speaker 1: for quite a long time, even the courts of England

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Speaker 1: and the laws of England roundly sided with employees when

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Speaker 1: it came to case law, and the very first of

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Speaker 1: which was the Dyer's case of fourteen fourteen, yeah, which

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Speaker 1: established a precedent that lasted for hundreds of years, which

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Speaker 1: is basically there was a dier, you know, fabric dyer

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Speaker 1: in London who had an apprentice and the apprentice was

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Speaker 1: ready to become a journeyman, no longer an apprentice, going

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Speaker 1: off to strikeout and form his own business. And he said,

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Speaker 1: you're not allowed to do this business in London, all

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Speaker 1: of London for six months, and in the fifteenth century

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Speaker 1: it wasn't very easy to move right right, So the

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Speaker 1: guy took him to court somehow in the fifteenth century way,

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Speaker 1: and the court said, we rule against you, die, or

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Speaker 1: we rule in favor of your journeyman apprentice, because they

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Speaker 1: reasoned that the law and custom should keep work in

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Speaker 1: the public domain, labor should be as free to do

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Speaker 1: as much as it can for as many people as possible. Yeah,

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Speaker 1: which makes sense, like maybe there aren't enough talented DIYers

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Speaker 1: in London right now, and for goodness sakes, like the

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Speaker 1: people need their tight eyed frocks, right, Thou blowest my mind.

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Speaker 1: It's good. I was waiting for another wavy gravy joke.

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Speaker 1: I know he's your gut to. He's the only one

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Speaker 1: I can ever think of. And then the other one

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Speaker 1: is that And this is a big part of this precedent,

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Speaker 1: was that someone should be allowed to go make a

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Speaker 1: living doing what they've learned to do, right. And there's

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Speaker 1: something inherent in both of those reasonings that set that

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Speaker 1: legal precedent in that they recognize that a noncompete favors

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Speaker 1: essentially one per in one group, one employer, one company,

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Speaker 1: one business owner at the at the expense of everybody else, right,

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Speaker 1: and they kept that up for hundreds of years. The

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Speaker 1: the what are they called, I guess the guild members

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Speaker 1: who were employing apprentices. Over the years, they employed more

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Speaker 1: and more apprentices as there was more and more people

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Speaker 1: who needed more and more work. So there's more and

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Speaker 1: more attempts. I don't think I could say more and

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Speaker 1: more any more time, but there are more and more

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Speaker 1: attempts I could at creating these um non compete agreements.

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Speaker 1: But the courts kept basically saying nine no, no, although

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Speaker 1: there was one that kind of went the opposite way,

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Speaker 1: which does seem like they made the right decision, but

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Speaker 1: it sent another precedent that actually upholds non competes. Right. Yeah,

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Speaker 1: this is Mitchell versus Reynolds in seventeen eleven, and Reynolds

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Speaker 1: was a baker. This one is. I agree. It's definitely

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Speaker 1: an interest in case because it's not like your standard

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Speaker 1: employee employer kind of thing. Right. M. Reynolds was a

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Speaker 1: baker who said hey, I will lease Hey there, Mitchell,

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Speaker 1: I'll lease you my bakery for five years and you

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Speaker 1: can do all the baking and make the money, and

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Speaker 1: I'm not gonna go start another bakery in this town,

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Speaker 1: which is Saint Andrew's Holborn. And I don't know why

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Speaker 1: I lost the accent halfway through that. And if I

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Speaker 1: violate this agreement, I give you fifty pounds and that's

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Speaker 1: exactly what I'll do, though I will go on to

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Speaker 1: break this deal. I'm gonna sell my stuff in town

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Speaker 1: and my baggetts or what have you. And Mitchell took

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Speaker 1: Reynolds to court and the judge sided with Mitchell in

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Speaker 1: this case. Yeah, because I'm quite sure I get it though.

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Speaker 1: This is this is why, this is why I think

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Speaker 1: it makes sense to us too. Mitchell and Reynolds were

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Speaker 1: um equal parties to this agreement. There was no power

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Speaker 1: position of one over the other. And that's one of

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Speaker 1: the reasons why are so unfair. It's a really powerful

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Speaker 1: entity taking advantage of the last power of the other person,

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Speaker 1: the employee that's on the other side of the equation.

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Speaker 1: In this case, they were equal and the guy broke it.

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Speaker 1: And yeah, he should pay because he agreed to this

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Speaker 1: ahead of time without any kind of of you know,

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Speaker 1: coercion or anything like that. Because Mitchell was able to

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Speaker 1: run this business and do the baking and make money,

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Speaker 1: and Reynolds was getting lease income from Mitchell. Yeah, so

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Speaker 1: he Reynolds was trying to have his cake and eat

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Speaker 1: it too. Basically exactly, he was a real big jerk

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Speaker 1: quad from what I can tell, we bleeped out your

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Speaker 1: first take, which was a cuss word, But jerkwad sounds

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Speaker 1: grosser than what you said. I think jerkwad was better.

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Speaker 1: I made the right decision in retaking that. Things you know,

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Speaker 1: started changing when industrial capitalism became a big thing and

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Speaker 1: the courts started kind of flipping a little bit all

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Speaker 1: of a sudden, they said, wait, this big business and

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Speaker 1: capitalism is great, so we should be a little more

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Speaker 1: pro employer than employee generally speaking. And I think it

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Speaker 1: was basically by the mid eighteen hundreds that they said, hey,

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Speaker 1: we believe in freedom of contract, which basically means if

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Speaker 1: you're both agreeing to this thing, then you should be

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Speaker 1: able to agree to this thing right, which again it

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Speaker 1: makes sense if you're Mitchell or Reynolds, who were on

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Speaker 1: even footing when entering into that contract. But people still

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Speaker 1: use freedom of contract as a defense of non competes.

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Speaker 1: And we'll walk down that path a little more later,

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Speaker 1: I say, Chuck, for right now, let's just go ahead

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Speaker 1: and take a break. Let's do it all right, I agree,

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Speaker 1: let's sign a contract agreed. So all this is going

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Speaker 1: on in England, and at the same time America is

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Speaker 1: doing its thing buying Louisiana, etc. And there wasn't really

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Speaker 1: any big non compete rulings until I think eighteen fifty one.

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Speaker 1: But leading up to that, there's a legal scholar named

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Speaker 1: Aisha Bell Hardaway who Olivia found. Livia helped us with

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Speaker 1: this one, and Yisha Bell Hardaway says that there was

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Speaker 1: still a bunch of like legal precedents and rulings and

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Speaker 1: laws that were established that basically support the idea that

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Speaker 1: non competes are unfair and that people should have the

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Speaker 1: ability to move about from employer to employer until they

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Speaker 1: find a good match um. And that a lot of

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Speaker 1: that came from reconstruction era and the Black Codes and

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Speaker 1: some of the laws that protected newly freed slaves um

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Speaker 1: to from like really um predatory business contracts that like

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Speaker 1: they could they could go to jail if they ended

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Speaker 1: the business, if they stopped working for the person, you know,

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Speaker 1: early they could go to jail for five or ten

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Speaker 1: years or something crazy like that. So the UM, the

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Speaker 1: US government, the federal government started stepping in and creating

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Speaker 1: these laws and including the Thirteenth Amendment that protected people

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Speaker 1: from that, and Hardaway argues that that's kind of a

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Speaker 1: basis for the America's position on non competes. Yeah, like,

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Speaker 1: congratulations on your emancipation. Um, Now you can enter into

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Speaker 1: a work contract that's basically the same thing as being enslaved, right,

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Speaker 1: except you know, you're you're making money, but if you

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Speaker 1: quit your job, you're going to jail, but also making money,

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Speaker 1: but you're making just enough to live. Well, you need

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Speaker 1: your job so badly you are engaged in what's known

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Speaker 1: as wage slavery, where you're so dependent on your job.

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Speaker 1: You're essentially stuck, and your employer can treat you however

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Speaker 1: they want, because number one, you're disposable because there's plenty

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Speaker 1: of other people who need a job. And then secondly,

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Speaker 1: they know that you can't go anywhere. You're stuck. You

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Speaker 1: need this job, and they often mistreat employees. And it

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Speaker 1: still happens today. Yeah, And like in England, early on

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Speaker 1: in the United States, the courts generally were siding on

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Speaker 1: the side of employees. There are quite a few cases

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Speaker 1: that sort of laid out precedent. One was really big

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Speaker 1: in eighteen seventy two. California even way backed then said

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Speaker 1: we're going to be a bunch of liberal hippies and

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Speaker 1: we're going to ban noncompetes altogether. Because here in the

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Speaker 1: United States, if you don't live here, a lot of times,

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Speaker 1: states are free to make their own laws concerning things

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Speaker 1: having to do with their state States Rights, States rights

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Speaker 1: and USA are low key mantra. States Rights. In California

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Speaker 1: was one of the first states to completely or maybe

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Speaker 1: the first state to completely ban noncompetes. Yeah, they said,

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Speaker 1: we don't know who he is yet, but in one

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Speaker 1: hundred or so years, Wavy Gravy's gonna love this. And

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Speaker 1: it went that way for you know, most of the

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Speaker 1: twentieth century. If ncas were allowed, they were pretty limited

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Speaker 1: in their enforcement and usually covered things like we talked about,

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Speaker 1: like trade secret cases and things like that, because you know, enforcement.

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Speaker 1: I didn't know about any of this stuff until you

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Speaker 1: and I entered the world of like signing contracts as

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Speaker 1: podcasters and stuff. I had always just had jobs where

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Speaker 1: you could work and get fired and quit and it

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Speaker 1: was no big deal. But I think you and I

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Speaker 1: learned an awful lot about contract stuff yea, through our

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Speaker 1: work and like how to read them and how many

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Speaker 1: words there are in them, yeah, and how lawyers charge

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Speaker 1: so much money for reading those words imperpetuity, imperpetuity throughout

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Speaker 1: the known universe, throughout the universe. That wasn't one of

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Speaker 1: them once, right, Yeah, So like we couldn't go to

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Speaker 1: Mars and set up of Mars farm and start podcasting

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Speaker 1: about it. No, we'd be served on Mars. But anyway,

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Speaker 1: we learned, and this was shocking to hear of something

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Speaker 1: just called unenforceability of a contract. We kind of thought

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Speaker 1: going into this thing like Rubes like, well, no contracts,

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Speaker 1: that that means you signed a contract. They're like, no,

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Speaker 1: you still got to enforce this. It's just like setting

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Speaker 1: a law. Someone can still break that law. You have

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Speaker 1: to have enforceability. And a lot of times these things

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Speaker 1: were not enforceable in the United States, right, but still are. Yeah,

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Speaker 1: that's absolutely true. But if you are somebody who's like

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Speaker 1: a highly skilled laborer who has access to proprietary information,

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Speaker 1: trade secrets, intellectual property, all just really high level stuff,

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Speaker 1: as far as the corporation is concerned. Very valuable stuff too.

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Speaker 1: If you're one of those workers and you signed a

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Speaker 1: noncompete agreement and you break it, you're probably going to

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Speaker 1: get ruled against depending on the state. If it's a

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Speaker 1: state that allows noncompete agreements, you're probably going to lose

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Speaker 1: that case because the courts have typically said okay. At

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Speaker 1: that level, you can probably hire a lawyer who can

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Speaker 1: explain to you what you're getting into beforehand. You probably

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Speaker 1: have a little bit of leverage where you can say,

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Speaker 1: I don't want to sign a noncompete, I'll give this

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Speaker 1: up instead. Or conversely, you can say, I'll sign your noncompete,

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Speaker 1: but you got my salary by ten percent or something

397
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Speaker 1: like that. And in that respect, it goes back to

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Speaker 1: the Mitchell versus Reynolds case. These two people, the employer

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Speaker 1: and the employee are on relatively equal footing enough so

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Speaker 1: that they're able to negotiate this non compete, and um,

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Speaker 1: that's why it would be upheld. Typically, that's that's when

402
00:24:10,400 --> 00:24:14,520
Speaker 1: it actually really makes sense. Yeah, So that brings us

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Speaker 1: to today. Um, Like I said, I think one in

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Speaker 1: five people in the United States work under a non

405
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Speaker 1: compete um, employers generally over the twenty first century have

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Speaker 1: gained more leverage and more power over workers, even though

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00:24:30,840 --> 00:24:33,919
Speaker 1: I think starting in with COVID in twenty twenty, I

408
00:24:33,920 --> 00:24:36,479
Speaker 1: think there's been UM not, I think like it's been

409
00:24:36,520 --> 00:24:41,080
Speaker 1: pretty well documented that there's been a shift toward employees

410
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Speaker 1: gaining a little more power and leverage. Yeah, but that's

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Speaker 1: new because it went the exact Yeah, it went the

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Speaker 1: opposite direction starting around the two thousand and eight financial meltdown. Yeah. Um,

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Speaker 1: there's a guy named Evans Starr who Olivia found that's

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Speaker 1: an economist at the University of Maryland. And as kind

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00:24:58,760 --> 00:25:01,879
Speaker 1: of if you just start researching non competes online, you'll

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Speaker 1: see Evans Starr name, Star's name come up a lot.

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Speaker 1: And uh, if you're like a CEO or not a

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00:25:10,000 --> 00:25:14,360
Speaker 1: CEO but an executive let's say executive level employee, chances

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Speaker 1: are you're working under a non compete. I think sixty

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Speaker 1: to eighty percent have to sign them, doesn't it. Yeah,

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Speaker 1: I would think it'd be more like eighty to ninety percent,

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Speaker 1: But I mean, who knows where they get these stats.

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Speaker 1: I don't think so. Um, but twenty percent. Uh so

424
00:25:38,359 --> 00:25:42,280
Speaker 1: sixty to eighty or high level executive level. But twenty

425
00:25:42,320 --> 00:25:46,800
Speaker 1: percent of all private sector workers are under a non compete.

426
00:25:46,840 --> 00:25:51,119
Speaker 1: About twelve percent of those make under twenty grand a year. Uh,

427
00:25:51,160 --> 00:25:55,080
Speaker 1: and this was really surprising. Seventeen percent are in service

428
00:25:55,080 --> 00:25:58,360
Speaker 1: work and the food and beverage industry. Yeah, and so

429
00:25:58,520 --> 00:26:02,240
Speaker 1: because there's so many more just like normal everyday employees

430
00:26:02,440 --> 00:26:06,800
Speaker 1: compared to like higher level executives, and because they've been

431
00:26:06,840 --> 00:26:10,600
Speaker 1: papering so many employees with non compete agreements that the

432
00:26:10,720 --> 00:26:14,720
Speaker 1: average person in the United States working under a non

433
00:26:14,760 --> 00:26:18,160
Speaker 1: compete is an hourly worker making fourteen dollars an hour

434
00:26:18,720 --> 00:26:21,560
Speaker 1: being forced to sign a noncompete. And I say forced

435
00:26:21,920 --> 00:26:25,120
Speaker 1: because in the case of m like a high level

436
00:26:25,160 --> 00:26:29,359
Speaker 1: executive who's able to negotiate or Mitchell and Baker that

437
00:26:29,840 --> 00:26:33,520
Speaker 1: in this case the employee is not able to negotiate anything.

438
00:26:33,960 --> 00:26:38,439
Speaker 1: Then the courts typically say, you can sign a noncompete,

439
00:26:38,520 --> 00:26:41,720
Speaker 1: but the company should give you something in consideration, typically

440
00:26:41,880 --> 00:26:45,400
Speaker 1: some sort of additional pay or something like that. In

441
00:26:45,440 --> 00:26:48,240
Speaker 1: the in the world of a fourteen dollars an hour

442
00:26:48,960 --> 00:26:52,399
Speaker 1: hourly worker who's signing a non compete, the consideration is

443
00:26:52,520 --> 00:26:55,120
Speaker 1: you get to be employed here. That's that's your consideration,

444
00:26:55,119 --> 00:26:57,600
Speaker 1: you can get to have this job that is in

445
00:26:57,640 --> 00:27:00,360
Speaker 1: no way, shape or form equal footing. And that's why

446
00:27:00,359 --> 00:27:02,040
Speaker 1: so many people pointing to these things and they're like,

447
00:27:02,400 --> 00:27:06,879
Speaker 1: this is this is jerk quad stuff. Yeah. The New

448
00:27:06,960 --> 00:27:09,600
Speaker 1: York Times had a big sort of expose in twenty

449
00:27:09,640 --> 00:27:13,359
Speaker 1: fourteen where it was revealed that and get these jobs

450
00:27:13,920 --> 00:27:19,760
Speaker 1: long care workers again, hairstylists, summer camp counselors had all

451
00:27:19,800 --> 00:27:23,840
Speaker 1: signed non compete agreements that was just sort of slipped

452
00:27:23,840 --> 00:27:27,000
Speaker 1: in with their paperwork, not realizing they'd signed it, not

453
00:27:27,119 --> 00:27:30,639
Speaker 1: fully explained or maybe explained even at all by their employers.

454
00:27:30,640 --> 00:27:33,920
Speaker 1: They're just like, here's your start work, just signed here here, here, here, right.

455
00:27:34,600 --> 00:27:37,960
Speaker 1: And there was a special case I believe that the

456
00:27:38,040 --> 00:27:42,480
Speaker 1: Huffington Post sort of exposed from Jimmy John's, the sandwich

457
00:27:42,520 --> 00:27:45,840
Speaker 1: shop where employees had to sign and non compete that

458
00:27:45,960 --> 00:27:49,520
Speaker 1: said you can't leave Jimmy John's and go work for

459
00:27:50,160 --> 00:27:54,359
Speaker 1: you know, a sandwich company not to be named. They're

460
00:27:55,160 --> 00:27:58,639
Speaker 1: say it, really, I'm just going to go take the

461
00:27:58,720 --> 00:28:03,400
Speaker 1: underground train and leave meeting really any sandwich shop, of course,

462
00:28:03,440 --> 00:28:06,639
Speaker 1: but I think they mean their main competitor, probably within

463
00:28:06,840 --> 00:28:09,479
Speaker 1: three miles of any Jimmy John's, not just the one

464
00:28:09,520 --> 00:28:12,960
Speaker 1: you worked at. And I don't know about their their

465
00:28:13,600 --> 00:28:16,239
Speaker 1: real estate plan for that company, but I bet you

466
00:28:16,280 --> 00:28:20,119
Speaker 1: anything part of their strategy is to open their restaurants

467
00:28:20,359 --> 00:28:23,520
Speaker 1: within three miles one of those other restaurants. Ye, so

468
00:28:23,680 --> 00:28:26,639
Speaker 1: basically said, I'm sorry if you're a sandwich artist, but

469
00:28:26,720 --> 00:28:28,840
Speaker 1: you can no longer really do this job right. And

470
00:28:28,920 --> 00:28:32,200
Speaker 1: I mean this isn't like like people who are sandwich

471
00:28:32,280 --> 00:28:36,920
Speaker 1: artists typically like need a job. Like there's very few

472
00:28:37,000 --> 00:28:39,720
Speaker 1: independently wealthy people who go get a job at Jimmy

473
00:28:39,800 --> 00:28:42,959
Speaker 1: John's because they like making sandwiches during the day. You know,

474
00:28:43,480 --> 00:28:45,920
Speaker 1: it's a it's a good job. I'm sure it's very fulfilling,

475
00:28:46,000 --> 00:28:49,200
Speaker 1: but typically when you have that job, you need the job.

476
00:28:49,280 --> 00:28:52,000
Speaker 1: And so the idea of putting a person in that

477
00:28:52,080 --> 00:28:57,680
Speaker 1: position into like just hobbling them as far as work

478
00:28:57,720 --> 00:29:01,040
Speaker 1: goes despicable. Man. I don't know if it's coming across

479
00:29:01,360 --> 00:29:04,520
Speaker 1: how I feel about non compete, but just every single

480
00:29:04,560 --> 00:29:07,560
Speaker 1: example just gets me riled up. You know you want

481
00:29:07,560 --> 00:29:10,640
Speaker 1: to hear something kind of fun. Yeah, Um, Our friend

482
00:29:10,720 --> 00:29:15,720
Speaker 1: John Hodgeman loves making breakfast sandwiches so much that he

483
00:29:16,960 --> 00:29:19,720
Speaker 1: spends his summers in Maine and there's a local like

484
00:29:19,920 --> 00:29:23,600
Speaker 1: breakfast place and he makes he goes there and works

485
00:29:23,600 --> 00:29:26,520
Speaker 1: occasionally for free. Yeah, just for the love of making

486
00:29:26,600 --> 00:29:29,520
Speaker 1: breakfast sandwiches. Yeah. But also I don't think you can

487
00:29:29,600 --> 00:29:35,280
Speaker 1: discount holding court. I think that's part of his compensation. Yeah.

488
00:29:35,360 --> 00:29:38,320
Speaker 1: And and the T shirt money he gets from my

489
00:29:38,400 --> 00:29:42,360
Speaker 1: egg sandwich was made by John Hodge. Humorous John Hodgman.

490
00:29:42,480 --> 00:29:45,360
Speaker 1: That's the sweetest plump. We should point out too, though,

491
00:29:45,400 --> 00:29:48,440
Speaker 1: by the way, that Jimmy John's did that for a

492
00:29:48,440 --> 00:29:51,240
Speaker 1: couple of years and then when the state Attorney general

493
00:29:51,240 --> 00:29:55,520
Speaker 1: started investigating, they dropped that practice. Oh that's good. Sure,

494
00:29:55,600 --> 00:29:58,600
Speaker 1: nothing like the state investigation to to get you, uh,

495
00:29:59,080 --> 00:30:03,120
Speaker 1: within the bounds of hic morality and decency. Um. There's

496
00:30:03,120 --> 00:30:05,600
Speaker 1: also something called a no poach agreement, which came under

497
00:30:05,640 --> 00:30:08,720
Speaker 1: fire in the two thousand Tents as well. Um, where

498
00:30:08,800 --> 00:30:12,080
Speaker 1: if you open a franchise, you would probably sign a

499
00:30:12,080 --> 00:30:15,560
Speaker 1: no poach agreement saying that you wouldn't hire any worker

500
00:30:15,920 --> 00:30:20,200
Speaker 1: from another store in that company another franchise, say like

501
00:30:20,240 --> 00:30:23,560
Speaker 1: across town. Right. This is really hard to give examples

502
00:30:23,560 --> 00:30:27,440
Speaker 1: and not buzz market any companies, you know. Yeah, I

503
00:30:27,440 --> 00:30:29,200
Speaker 1: think we're doing it though, we're doing okay. So like

504
00:30:29,280 --> 00:30:33,160
Speaker 1: if you went to um, you know, mister Sandwich and

505
00:30:34,280 --> 00:30:36,600
Speaker 1: you didn't like your boss there, so you you went

506
00:30:36,640 --> 00:30:38,600
Speaker 1: to go get hired at another mister Sandwich, if they

507
00:30:38,600 --> 00:30:40,760
Speaker 1: had a no poach agreement, that second mister Sandwich would

508
00:30:40,800 --> 00:30:45,800
Speaker 1: say sorry, we can't hire you. Or yeah. Conversely, if

509
00:30:45,840 --> 00:30:50,760
Speaker 1: you if you run an mister Rose beef sandwich place

510
00:30:51,440 --> 00:30:54,840
Speaker 1: and you have the meat as an owner, you can't

511
00:30:54,840 --> 00:30:59,240
Speaker 1: go cheez the uh Fred over there at the Crosstown

512
00:30:59,640 --> 00:31:03,360
Speaker 1: Mister Roast Beef Sandwich really moves that beef like nobody

513
00:31:03,360 --> 00:31:06,320
Speaker 1: I've ever seen. This guy settles a beef like a champion.

514
00:31:06,680 --> 00:31:09,800
Speaker 1: You can't say entice this person by saying, hey, I'll

515
00:31:09,840 --> 00:31:12,480
Speaker 1: pay an extra buck fifty an hour to make your

516
00:31:12,520 --> 00:31:15,280
Speaker 1: beef sales over here. Yeah, that would be poaching for sure.

517
00:31:15,720 --> 00:31:20,200
Speaker 1: And then you can you can thank again state investigations

518
00:31:20,240 --> 00:31:22,800
Speaker 1: for doing away with this. Largely some of the larger

519
00:31:22,920 --> 00:31:24,960
Speaker 1: chains said oh, yeah, we shouldn't do that. We're not

520
00:31:24,960 --> 00:31:27,320
Speaker 1: going to do that anymore. You can call off your

521
00:31:28,080 --> 00:31:33,160
Speaker 1: state attorneys investigations. So we've been sort of peppering in

522
00:31:33,320 --> 00:31:38,920
Speaker 1: the I'm against NCAA arguments, there are actual statistics to

523
00:31:39,120 --> 00:31:40,960
Speaker 1: kind of back up some of the stuff that we

524
00:31:41,160 --> 00:31:44,840
Speaker 1: feel passionately about. In one case, in the state of

525
00:31:44,840 --> 00:31:47,640
Speaker 1: Oregon in two thousand and eight, they banned non competes

526
00:31:47,720 --> 00:31:53,440
Speaker 1: for most workers, but one of the categories was low

527
00:31:53,480 --> 00:31:57,480
Speaker 1: wage hourly employees that we were speaking about. And mister

528
00:31:57,560 --> 00:32:00,320
Speaker 1: Starr comes back in the picture and a gentleman named

529
00:32:00,360 --> 00:32:06,000
Speaker 1: Michael Lipsets of the FTC Bureau of Economists, and they

530
00:32:06,080 --> 00:32:10,120
Speaker 1: did some statistical analysis and found in an Oregon hourly

531
00:32:10,240 --> 00:32:14,400
Speaker 1: wages rose two to three percent, not just for people

532
00:32:14,400 --> 00:32:18,760
Speaker 1: who would signed NCA's but for everybody in the state. Yeah,

533
00:32:18,880 --> 00:32:21,720
Speaker 1: and they reckon that maybe between fourteen and twenty one

534
00:32:21,720 --> 00:32:26,240
Speaker 1: percent of people who signed ncas had their Well wait,

535
00:32:26,520 --> 00:32:28,880
Speaker 1: was it fourteen to twenty one percent of workers? No,

536
00:32:28,960 --> 00:32:32,800
Speaker 1: that's how Yeah, their wages increase fourteen to twenty one

537
00:32:32,800 --> 00:32:35,400
Speaker 1: percent for people who had been working under non competes

538
00:32:35,600 --> 00:32:38,040
Speaker 1: after they were banned, it went right that much. That

539
00:32:38,240 --> 00:32:43,520
Speaker 1: is a I hate the word whopping so much because

540
00:32:44,000 --> 00:32:46,080
Speaker 1: I want to do a little tangent here, chuck um.

541
00:32:46,880 --> 00:32:50,600
Speaker 1: If you use the word whopping in your writing, what

542
00:32:50,640 --> 00:32:53,560
Speaker 1: you're doing is you're assuming that your readers too stupid

543
00:32:53,680 --> 00:32:57,719
Speaker 1: to understand that what statistic you've just said is actually

544
00:32:57,760 --> 00:33:02,120
Speaker 1: like eye popping or like really significant. You're spoon feeding

545
00:33:02,160 --> 00:33:04,200
Speaker 1: them the fact that, like, hey, this is a really

546
00:33:04,240 --> 00:33:07,400
Speaker 1: big deal, rather than just letting them figure it out themselves.

547
00:33:07,440 --> 00:33:09,480
Speaker 1: Are knowing that they probably are going to figure it

548
00:33:09,520 --> 00:33:12,400
Speaker 1: out themselves, So don't use whopping. But the point is

549
00:33:12,440 --> 00:33:16,120
Speaker 1: this best statistic is so huge. I will use the

550
00:33:16,120 --> 00:33:19,560
Speaker 1: word whopping here because it's the true definition of whopping.

551
00:33:19,560 --> 00:33:23,040
Speaker 1: It's overwhelming. I can barely speak at such a big deal,

552
00:33:24,240 --> 00:33:26,600
Speaker 1: I think. Instead of writing whopping, though, what you can

553
00:33:26,720 --> 00:33:30,360
Speaker 1: do is say, get a load of this and then

554
00:33:30,400 --> 00:33:34,480
Speaker 1: have a little button you click that goes, damn yeah,

555
00:33:34,640 --> 00:33:37,200
Speaker 1: how about this for a whopping statistic? Though, to sort

556
00:33:37,240 --> 00:33:41,080
Speaker 1: of button up on the stats. The FTC has estimated

557
00:33:41,480 --> 00:33:45,840
Speaker 1: that if they eliminated ncas all across the country I

558
00:33:45,880 --> 00:33:49,520
Speaker 1: guess federally, or if every state did, it would generate

559
00:33:49,600 --> 00:33:53,080
Speaker 1: new job opportunities for up to thirty million workers and

560
00:33:53,280 --> 00:33:58,200
Speaker 1: raise wages by three hundred billion dollars. Yeah for those workers. Basically,

561
00:33:58,520 --> 00:34:01,400
Speaker 1: that's not even spillover stuff from what I understand. And

562
00:34:01,560 --> 00:34:04,760
Speaker 1: there's another little stat from that same FTC study that

563
00:34:04,800 --> 00:34:10,359
Speaker 1: if you eliminate eliminated non competes for doctors, healthcare costs

564
00:34:10,400 --> 00:34:12,279
Speaker 1: would go down by about one hundred and forty eight

565
00:34:12,280 --> 00:34:15,680
Speaker 1: billion dollars too. Wo Yeah, which is another problem in

566
00:34:15,760 --> 00:34:18,200
Speaker 1: and of itself. Doctors who signed non competes can't move

567
00:34:18,200 --> 00:34:21,480
Speaker 1: from hospital to hospital, and so hospitals can basically hoard

568
00:34:22,120 --> 00:34:26,200
Speaker 1: um medical talent while other hospitals are starving for it.

569
00:34:26,239 --> 00:34:29,000
Speaker 1: Because these doctors have non competes, they can't just go

570
00:34:29,040 --> 00:34:32,239
Speaker 1: to this other hospital that really needs their help. And

571
00:34:32,280 --> 00:34:34,759
Speaker 1: that's that's a problem too. I Mean it's bad enough

572
00:34:34,800 --> 00:34:38,680
Speaker 1: with like franchises of Mister Sandwich. When it's hospitals preventing

573
00:34:38,760 --> 00:34:41,240
Speaker 1: doctors from going to heal the sick, that's a huge

574
00:34:41,239 --> 00:34:46,879
Speaker 1: problem as well. Yeah, if you're arguing against NCAA's California,

575
00:34:46,960 --> 00:34:49,239
Speaker 1: like I said, was very early to get on that

576
00:34:49,719 --> 00:34:52,840
Speaker 1: anti nca train, people will often point to California and

577
00:34:52,960 --> 00:34:57,439
Speaker 1: especially the tech industry. Like in twenty fourteen, the state

578
00:34:57,480 --> 00:35:00,560
Speaker 1: of Massachusetts said should we ban non pizza or not?

579
00:35:00,960 --> 00:35:03,640
Speaker 1: They eventually did in twenty eighteen, but they said one

580
00:35:03,640 --> 00:35:06,359
Speaker 1: of their arguments was look at California. Yea, Like back

581
00:35:06,360 --> 00:35:10,239
Speaker 1: in the seventies, we were on par with like the

582
00:35:10,239 --> 00:35:13,160
Speaker 1: Boston areas, on par with San Francisco as far as

583
00:35:13,200 --> 00:35:16,800
Speaker 1: tech development, and the fact that we had non competes

584
00:35:17,200 --> 00:35:20,000
Speaker 1: really hindered us. And look at what happened in California.

585
00:35:20,040 --> 00:35:22,480
Speaker 1: It's now that the tech capital of the United States,

586
00:35:22,520 --> 00:35:27,440
Speaker 1: if not the world, Northern California and Silicon Valley and Boston,

587
00:35:27,640 --> 00:35:29,600
Speaker 1: you know, didn't fall off the map. There's still good

588
00:35:29,600 --> 00:35:32,080
Speaker 1: tech there, but it didn't become what California did. No,

589
00:35:32,200 --> 00:35:36,400
Speaker 1: because the ncas were so efficiently enforced that when you

590
00:35:36,600 --> 00:35:38,839
Speaker 1: signed on for a company, you're like, well, I'm here

591
00:35:38,840 --> 00:35:41,799
Speaker 1: for the rest of my career. Yeah, and ideally you

592
00:35:41,840 --> 00:35:43,880
Speaker 1: know the company would take care of you for the

593
00:35:43,880 --> 00:35:45,680
Speaker 1: rest of your career. So there was a trade off

594
00:35:45,719 --> 00:35:47,759
Speaker 1: for that, but that just meant that there were no

595
00:35:47,840 --> 00:35:51,080
Speaker 1: people jumping chipping, like starting their own companies, and they

596
00:35:51,080 --> 00:35:53,879
Speaker 1: were doing that in Silicon Valley. I say, we take

597
00:35:53,920 --> 00:35:57,640
Speaker 1: a break. But I've got two more arguments against non competes.

598
00:35:58,800 --> 00:36:02,399
Speaker 1: So one is that it stagnates job churn. And job

599
00:36:02,520 --> 00:36:04,640
Speaker 1: churn is people being able to move from employer to

600
00:36:04,680 --> 00:36:07,720
Speaker 1: employer until they find the right fit. Because ideally every

601
00:36:07,760 --> 00:36:11,360
Speaker 1: worker and every employer would fit and work together well,

602
00:36:11,440 --> 00:36:15,400
Speaker 1: which would raise general productivity through the roof. Of course,

603
00:36:15,440 --> 00:36:18,239
Speaker 1: if that were able to be done, and job churn

604
00:36:18,360 --> 00:36:21,200
Speaker 1: is how that happens. And then in a related way,

605
00:36:21,600 --> 00:36:24,319
Speaker 1: if people are allowed to just jump ship from a

606
00:36:24,400 --> 00:36:28,200
Speaker 1: terrible company, that company is bound to basically say we

607
00:36:28,239 --> 00:36:31,240
Speaker 1: need to figure out what's wrong with us and get better,

608
00:36:31,719 --> 00:36:34,440
Speaker 1: or else we're going to not be competitive anymore and

609
00:36:34,480 --> 00:36:37,480
Speaker 1: our company is going to go under. If you force

610
00:36:37,560 --> 00:36:40,920
Speaker 1: everybody to stay aboard the sinking ship through non competes,

611
00:36:41,440 --> 00:36:43,359
Speaker 1: there's no way to do it. No. Plus, I mean,

612
00:36:43,400 --> 00:36:46,440
Speaker 1: you're just basically stagnating your company and the careers of

613
00:36:46,480 --> 00:36:49,560
Speaker 1: the people who are on board. Yeah, you keep people

614
00:36:49,600 --> 00:36:51,759
Speaker 1: by being a great company to work for it exactly

615
00:36:51,800 --> 00:36:54,200
Speaker 1: you done by holding them hostage because their name is

616
00:36:54,200 --> 00:36:56,239
Speaker 1: on a piece of paper. I'm glad you said it. Man,

617
00:36:56,320 --> 00:36:58,759
Speaker 1: that's a great time for a break. All right, We'll

618
00:36:58,760 --> 00:37:29,200
Speaker 1: be right back, all right. So early on you said

619
00:37:29,239 --> 00:37:33,560
Speaker 1: that's the last argument for NCA's um. That's not entirely true.

620
00:37:33,600 --> 00:37:36,520
Speaker 1: But there is one group who would say that ncas

621
00:37:36,560 --> 00:37:39,400
Speaker 1: are great, and that is the US Chamber of Commerce.

622
00:37:40,520 --> 00:37:42,640
Speaker 1: And they say that one of the things that we

623
00:37:43,360 --> 00:37:46,960
Speaker 1: m we didn't like completely quash, but they say, hey,

624
00:37:46,960 --> 00:37:49,960
Speaker 1: when you sign a noncompete, that means you're probably getting

625
00:37:50,000 --> 00:37:53,080
Speaker 1: something good back in return to which means it's equal footing.

626
00:37:53,560 --> 00:37:56,480
Speaker 1: And like you said earlier, unless you're like a really

627
00:37:56,600 --> 00:38:01,160
Speaker 1: top tier echelon person who's able to negociate, like hey,

628
00:38:01,320 --> 00:38:04,839
Speaker 1: a twenty five percent bump and salary to sign this thing,

629
00:38:05,239 --> 00:38:07,759
Speaker 1: then you're probably not geting getting nothing in return. Yeah,

630
00:38:07,800 --> 00:38:09,560
Speaker 1: you're just getting the job and shut up and be

631
00:38:09,640 --> 00:38:12,560
Speaker 1: happy that you even have a job. Get to work, basically.

632
00:38:13,200 --> 00:38:16,160
Speaker 1: Another one is that that thing that you and I

633
00:38:16,200 --> 00:38:20,080
Speaker 1: agreed on that companies would probably be a little more

634
00:38:20,880 --> 00:38:24,560
Speaker 1: likely to invest in their workers if they have a

635
00:38:24,600 --> 00:38:27,280
Speaker 1: good sense that their workers aren't going to just leave

636
00:38:27,480 --> 00:38:30,839
Speaker 1: for their competitors. Yeah, that holds up, But it only

637
00:38:30,880 --> 00:38:33,520
Speaker 1: holds up to a certain extent, because if you invest

638
00:38:33,560 --> 00:38:36,480
Speaker 1: in your workers and like really good training, what you're

639
00:38:36,520 --> 00:38:40,680
Speaker 1: doing is producing an employee who understands your product, understands

640
00:38:40,680 --> 00:38:43,799
Speaker 1: how the business goes, understands their department really well. So

641
00:38:43,800 --> 00:38:46,319
Speaker 1: they're probably really good at customer service. They know what

642
00:38:46,360 --> 00:38:49,239
Speaker 1: they can and can't promise, They understand what can be

643
00:38:49,280 --> 00:38:52,120
Speaker 1: replaced with what they're just they know what they're doing,

644
00:38:52,200 --> 00:38:55,560
Speaker 1: and so productivity goes up, which means that by training

645
00:38:55,600 --> 00:38:58,879
Speaker 1: that worker, you're actually making your money back. And then

646
00:38:58,960 --> 00:39:01,880
Speaker 1: some there's a return on investment, and that usually comes

647
00:39:01,920 --> 00:39:04,879
Speaker 1: pretty quickly after they come on board and are brought

648
00:39:04,960 --> 00:39:08,520
Speaker 1: up to speed and become productive. So after throughout the

649
00:39:08,560 --> 00:39:11,799
Speaker 1: life of that person's employment with you, you made your

650
00:39:11,800 --> 00:39:14,080
Speaker 1: money back, and say like the first quarter of that time,

651
00:39:14,239 --> 00:39:17,200
Speaker 1: the rest of it is just profit from that higher productivity.

652
00:39:17,400 --> 00:39:19,480
Speaker 1: So it does hold up. The argument does hold up,

653
00:39:19,520 --> 00:39:22,359
Speaker 1: but it only holds up so far, right, And then

654
00:39:22,680 --> 00:39:25,759
Speaker 1: one other thing is that the Chamber of Commerce likes

655
00:39:25,760 --> 00:39:28,399
Speaker 1: to do that freedom of contract thing where they're like, hey,

656
00:39:29,160 --> 00:39:32,560
Speaker 1: we should not be treading on employees rights as adults.

657
00:39:32,600 --> 00:39:37,279
Speaker 1: They say this, sometimes assign whatever contract they please, and

658
00:39:37,360 --> 00:39:40,040
Speaker 1: they leave out of it entirely the imbalance of power.

659
00:39:40,160 --> 00:39:42,440
Speaker 1: But that's one of the that's one of their talking

660
00:39:42,480 --> 00:39:46,520
Speaker 1: points as well, typically freedom of contract. Yeah, we mentioned,

661
00:39:46,840 --> 00:39:49,799
Speaker 1: and you sort of inadvertently teased earlier, other kinds of agreements,

662
00:39:50,360 --> 00:39:52,960
Speaker 1: and we mentioned these because a lot of these are

663
00:39:53,600 --> 00:39:57,319
Speaker 1: workarounds to just signing a full non compete, like the

664
00:39:57,360 --> 00:40:00,360
Speaker 1: trade secret thing that we mentioned, you can sign a

665
00:40:00,400 --> 00:40:04,879
Speaker 1: nondisclosure agreement or an intellectual property agreement. In the case

666
00:40:04,920 --> 00:40:08,480
Speaker 1: of nondisclosure, it means you can't disclose stuff that went

667
00:40:08,520 --> 00:40:11,040
Speaker 1: on at your company, like we can't you know, in

668
00:40:11,040 --> 00:40:13,920
Speaker 1: the case of like podcast networks, you couldn't jump to

669
00:40:13,960 --> 00:40:16,680
Speaker 1: another podcast network and say, oh, well, this is how

670
00:40:16,719 --> 00:40:21,480
Speaker 1: we do our ad sales or whatever. You can't do

671
00:40:21,480 --> 00:40:25,840
Speaker 1: that because you signed an NDA. But that's not the

672
00:40:25,920 --> 00:40:27,920
Speaker 1: same thing as a noncompete. You can still go get

673
00:40:27,960 --> 00:40:32,560
Speaker 1: that job with IP property or intellectual property agreements. That's

674
00:40:32,560 --> 00:40:35,000
Speaker 1: obviously if you work for that company and you come

675
00:40:35,080 --> 00:40:37,080
Speaker 1: up with an idea while you're working for that company,

676
00:40:37,160 --> 00:40:40,560
Speaker 1: they basically own that idea. Another one is a non

677
00:40:40,560 --> 00:40:44,480
Speaker 1: solicitation agreement, which is sort of like a non poaching thing,

678
00:40:45,280 --> 00:40:48,279
Speaker 1: which means you can't go out and like if we

679
00:40:48,280 --> 00:40:51,719
Speaker 1: went and started our own podcast network, we couldn't just

680
00:40:51,880 --> 00:40:53,560
Speaker 1: sign all of our friends that we've worked with for

681
00:40:53,560 --> 00:40:56,520
Speaker 1: twenty years, right, or you know, get all the customers

682
00:40:56,600 --> 00:40:59,360
Speaker 1: or something that we've been interacting with the salespeople for

683
00:40:59,440 --> 00:41:03,040
Speaker 1: whatever company we work for. Yeah, but here's the thing

684
00:41:03,320 --> 00:41:06,040
Speaker 1: with some of these, like like I have a friend

685
00:41:06,120 --> 00:41:10,799
Speaker 1: who worked for someone doing a service as the employee,

686
00:41:10,920 --> 00:41:13,200
Speaker 1: and I don't want to get too specific, but the

687
00:41:14,239 --> 00:41:16,880
Speaker 1: employer like usually when you're like, you know what, I

688
00:41:16,920 --> 00:41:19,640
Speaker 1: could do this and I'm better at it, and I

689
00:41:19,640 --> 00:41:22,440
Speaker 1: could do better at it, and the clients will follow me.

690
00:41:23,040 --> 00:41:26,960
Speaker 1: Usually you're doing that because the situation you're in stincts,

691
00:41:27,960 --> 00:41:29,800
Speaker 1: you know, like you got an owner that's not treating

692
00:41:29,800 --> 00:41:31,840
Speaker 1: your right or an owner that doesn't do any of

693
00:41:31,840 --> 00:41:34,239
Speaker 1: the work and they're just sitting back and collecting checks

694
00:41:34,239 --> 00:41:37,920
Speaker 1: while you're doing everything right. Usually, I mean sometimes people

695
00:41:38,360 --> 00:41:41,840
Speaker 1: it's just like got a great situation and they're like,

696
00:41:41,880 --> 00:41:43,760
Speaker 1: you know, I would like to do this myself as well.

697
00:41:43,920 --> 00:41:46,279
Speaker 1: That does happen. I'm not saying it doesn't, but it's

698
00:41:46,360 --> 00:41:49,600
Speaker 1: usually because like it's a bad employer and a bad

699
00:41:49,640 --> 00:41:52,080
Speaker 1: business to begin with the other way. It's got to

700
00:41:52,120 --> 00:41:55,000
Speaker 1: be so frustrating too. If you're working under a non compete.

701
00:41:55,320 --> 00:41:57,920
Speaker 1: Is if you have this great idea and you do

702
00:41:57,960 --> 00:42:00,680
Speaker 1: what you're supposed to do in that situation as an employee,

703
00:42:00,680 --> 00:42:03,680
Speaker 1: and you take it to your employer and say, let's

704
00:42:03,680 --> 00:42:05,200
Speaker 1: do this. This is going to make the company a

705
00:42:05,200 --> 00:42:07,359
Speaker 1: bunch of money, and they're like, nah, it's not worth it,

706
00:42:07,560 --> 00:42:11,160
Speaker 1: and so your idea just dies. Then people like you

707
00:42:11,200 --> 00:42:14,080
Speaker 1: and me, we suffer for that because we miss out

708
00:42:14,160 --> 00:42:18,560
Speaker 1: on the amazing innovation or that extra competition that drives

709
00:42:18,600 --> 00:42:21,600
Speaker 1: prices down a little bit. It has a huge kind

710
00:42:21,640 --> 00:42:25,960
Speaker 1: of society wide effect. Yeah, for sure. I guess the

711
00:42:26,000 --> 00:42:28,480
Speaker 1: last thing we should mention is the pay not to play.

712
00:42:28,520 --> 00:42:31,560
Speaker 1: It's also called the garden leave, like you're taking time off,

713
00:42:31,560 --> 00:42:34,600
Speaker 1: it's into your garden. This is when an employee leaves

714
00:42:34,640 --> 00:42:37,960
Speaker 1: and a company might say, hey, don't go work for

715
00:42:38,000 --> 00:42:41,480
Speaker 1: a competitor for six months, but we'll pay you for

716
00:42:41,480 --> 00:42:44,080
Speaker 1: those six months. Yeah. It's often something like fifty percent

717
00:42:44,160 --> 00:42:46,319
Speaker 1: of the salary that you have over the last two

718
00:42:46,360 --> 00:42:49,160
Speaker 1: years or something. Yeah, exactly, which is pretty sweet. And

719
00:42:49,200 --> 00:42:53,480
Speaker 1: again that's consideration in exchange for signing a non compete,

720
00:42:53,800 --> 00:42:56,200
Speaker 1: which makes or you might get bought out of a

721
00:42:56,280 --> 00:42:59,920
Speaker 1: contract or something like, hey, we'll just buy you out

722
00:42:59,920 --> 00:43:03,759
Speaker 1: of your contracted but you can't go work for anyone else. Yeah, so, chuck,

723
00:43:03,800 --> 00:43:06,920
Speaker 1: there's if you weren't like Boo, I hate non competes

724
00:43:06,960 --> 00:43:11,480
Speaker 1: before prepared to join the wagon or jump on the wagon. Yeah,

725
00:43:11,520 --> 00:43:18,399
Speaker 1: the bandwagon. Some companies, including companies in California still use

726
00:43:18,480 --> 00:43:21,400
Speaker 1: non competes. They still make their employees sign them. And

727
00:43:21,480 --> 00:43:24,840
Speaker 1: they do this because they can still threaten their employees

728
00:43:25,120 --> 00:43:29,759
Speaker 1: with a lawsuit for breaking this noncompete that's illegal to

729
00:43:29,800 --> 00:43:32,919
Speaker 1: begin with, because they know their employees either number one,

730
00:43:33,239 --> 00:43:37,359
Speaker 1: don't know that non competes are unenforceable in some states YEA,

731
00:43:37,600 --> 00:43:40,239
Speaker 1: or number two, even if they do know that, don't

732
00:43:40,280 --> 00:43:42,920
Speaker 1: have the means to defend themselves, to hire a lawyer

733
00:43:42,960 --> 00:43:45,160
Speaker 1: to defend themselves, even if they're on the right side

734
00:43:45,160 --> 00:43:49,799
Speaker 1: of the law. That is despicable. It is as is

735
00:43:50,239 --> 00:43:52,760
Speaker 1: using saying like, all right, we don't have a non compete,

736
00:43:53,120 --> 00:43:57,320
Speaker 1: but we're going to draw up our non disclosure agreement

737
00:43:57,400 --> 00:44:01,839
Speaker 1: or non solicitation agreement so broadly that it's basically a noncompete. Right.

738
00:44:02,239 --> 00:44:05,600
Speaker 1: So because of this, because that's becoming more and more common,

739
00:44:05,640 --> 00:44:09,759
Speaker 1: and apparently also there's a twenty twenty two article and

740
00:44:09,920 --> 00:44:15,200
Speaker 1: Benefits pro the Employment Benefits trade magazine of Record that

741
00:44:15,360 --> 00:44:19,040
Speaker 1: said that more employers are more and more frequently turning

742
00:44:19,080 --> 00:44:24,359
Speaker 1: to threatening lawsuits over non competes because they're they're low

743
00:44:24,440 --> 00:44:28,440
Speaker 1: on workers. Because it's a it's a it's a worker's market,

744
00:44:28,560 --> 00:44:31,080
Speaker 1: right now it's not an employer's market anymore. So to

745
00:44:31,200 --> 00:44:36,359
Speaker 1: keep people employed, they're threatening to see their own employees basically, yeah, uh,

746
00:44:36,480 --> 00:44:38,360
Speaker 1: and this is you know, I'm not sure if you

747
00:44:38,400 --> 00:44:41,200
Speaker 1: picked this one for this reason, but this is a

748
00:44:41,239 --> 00:44:44,560
Speaker 1: hot topic right now, largely because of what's been going

749
00:44:44,600 --> 00:44:47,640
Speaker 1: on with employees getting more rights. And there's a new

750
00:44:47,960 --> 00:44:51,520
Speaker 1: proposal as of just last month in January twenty twenty

751
00:44:51,520 --> 00:44:56,320
Speaker 1: three from the FTC that would ban noncompetes altogether basically

752
00:44:56,400 --> 00:44:58,920
Speaker 1: and avoid the ones that are currently in plays, which

753
00:44:58,960 --> 00:45:02,399
Speaker 1: would be a huge d Biden signed an executive order

754
00:45:02,400 --> 00:45:06,120
Speaker 1: in twenty twenty one that encouraged the FDA to band

755
00:45:06,200 --> 00:45:09,960
Speaker 1: and limit them. And yeah, the FTC, and it basically

756
00:45:09,960 --> 00:45:14,839
Speaker 1: says that it forbids you from using these and you

757
00:45:14,880 --> 00:45:17,560
Speaker 1: have to like let people know. You know, in the

758
00:45:17,600 --> 00:45:20,160
Speaker 1: case you were talking about in the California where they

759
00:45:20,200 --> 00:45:22,960
Speaker 1: basically signed them and didn't know, you have to let

760
00:45:22,960 --> 00:45:25,840
Speaker 1: these employees know that they're under a noncompete and be

761
00:45:25,920 --> 00:45:28,560
Speaker 1: like really clear with the language, right you, Well, you

762
00:45:28,680 --> 00:45:32,200
Speaker 1: also know no, and it's not valid anymore. Right, it's

763
00:45:32,200 --> 00:45:34,359
Speaker 1: saying like you can't you can't have them. Not only

764
00:45:34,400 --> 00:45:38,200
Speaker 1: can you not sign somebody under a noncompete agreement, like

765
00:45:38,239 --> 00:45:39,799
Speaker 1: you have to let them know that the ones that

766
00:45:39,920 --> 00:45:42,520
Speaker 1: you used to have that we're valid, are not valid

767
00:45:42,560 --> 00:45:46,480
Speaker 1: any longer. They've been outlawed. Yeah, like they shouldn't have

768
00:45:46,520 --> 00:45:48,759
Speaker 1: to go pay an attorney to tell them that exactly.

769
00:45:49,080 --> 00:45:51,520
Speaker 1: And it even goes even further. So some of those,

770
00:45:51,600 --> 00:45:54,640
Speaker 1: like um other types like a non disclosure agreement that

771
00:45:54,640 --> 00:45:58,279
Speaker 1: can be so broad it's effectively and noncompete those are

772
00:45:58,440 --> 00:46:01,799
Speaker 1: those are basically outlawed as well. It's a huge idea,

773
00:46:02,200 --> 00:46:06,080
Speaker 1: And right now they're taking public comments through March twentieth.

774
00:46:06,600 --> 00:46:09,799
Speaker 1: So if you're like, I, here's ours exactly. If you're

775
00:46:09,840 --> 00:46:13,319
Speaker 1: like I don't really feel good about non disclosure agreements

776
00:46:13,680 --> 00:46:17,560
Speaker 1: or non competes, then you can go leave your remarks.

777
00:46:17,800 --> 00:46:20,400
Speaker 1: The Chamber of Commerces said we're gonna sue you. FTC.

778
00:46:20,400 --> 00:46:23,000
Speaker 1: You can't do this, and the FTC said, oh, yes

779
00:46:23,040 --> 00:46:26,440
Speaker 1: we can. So we'll see what happens, either with the

780
00:46:26,520 --> 00:46:30,160
Speaker 1: FTC directly doing it, or if the FTC finds out

781
00:46:30,200 --> 00:46:34,000
Speaker 1: that their hands actually are tied. Congress might actually step in.

782
00:46:34,040 --> 00:46:36,600
Speaker 1: There was a bipartisan bill that was introduced in twenty

783
00:46:36,640 --> 00:46:41,040
Speaker 1: twenty one that basically by by partisan. I know, if

784
00:46:41,040 --> 00:46:43,879
Speaker 1: you completed us it's a very strange sounding word. I'm

785
00:46:43,880 --> 00:46:46,080
Speaker 1: glad you brought up where I got this idea, because

786
00:46:46,080 --> 00:46:48,160
Speaker 1: it turns out I got this idea from um. She

787
00:46:48,239 --> 00:46:51,520
Speaker 1: sent me an article about this FTC proposal and how

788
00:46:51,520 --> 00:46:54,440
Speaker 1: it would save three hundred billion or create three hundred

789
00:46:54,440 --> 00:47:00,560
Speaker 1: billion in salary. Just pretty was the subject line to No.

790
00:47:00,719 --> 00:47:04,880
Speaker 1: She said, check out this whopping stat right, it's like

791
00:47:04,920 --> 00:47:08,359
Speaker 1: the old click date. Yeah, exactly. You won't believe number eight.

792
00:47:10,080 --> 00:47:14,200
Speaker 1: He got anything else? Uh no, just a listener mail. Okay, Well,

793
00:47:14,239 --> 00:47:16,600
Speaker 1: since Chuck just mentioned listener mail, that means it's time

794
00:47:16,640 --> 00:47:22,959
Speaker 1: for listener mail. That reminds me of The Simpsons. Yeah,

795
00:47:22,960 --> 00:47:26,319
Speaker 1: I know exactly, Harmon Tansyrian, And now i'd like to

796
00:47:26,320 --> 00:47:30,520
Speaker 1: introduce your new Principal Skinner. Principal Skinner. I thought you

797
00:47:30,560 --> 00:47:33,080
Speaker 1: were gonna say you remember our friend Brian, the sound

798
00:47:33,080 --> 00:47:35,759
Speaker 1: guy from the TV show. Oh sure, Every once in

799
00:47:35,800 --> 00:47:39,320
Speaker 1: a while he emails me just one line from The Simpsons.

800
00:47:39,840 --> 00:47:42,160
Speaker 1: Really walk into the bar and there's tons of carbon

801
00:47:42,200 --> 00:47:45,200
Speaker 1: monoxide in the bar, and everybody's passed out, and the

802
00:47:45,239 --> 00:47:48,359
Speaker 1: guy says, man alive. There are men alive in here.

803
00:47:50,320 --> 00:47:53,680
Speaker 1: Brian texts me every now and then. He's a talented

804
00:47:53,800 --> 00:47:57,239
Speaker 1: musician in the band The Georgia's Soul Council. Yeah, that's right,

805
00:47:58,000 --> 00:48:01,520
Speaker 1: he's a great guy too. Go see him all right,

806
00:48:01,600 --> 00:48:04,600
Speaker 1: here we go, new mom life saver. Well, just like

807
00:48:04,640 --> 00:48:07,200
Speaker 1: these little nice emails every now and then. Hey, guys,

808
00:48:07,280 --> 00:48:09,640
Speaker 1: my now husband introduced me to your show during the

809
00:48:09,680 --> 00:48:12,640
Speaker 1: infamous spring of twenty twenty, and I've enjoyed hours of

810
00:48:12,719 --> 00:48:16,560
Speaker 1: educational entertainment since then. We welcomed our little boy, Ronan

811
00:48:16,800 --> 00:48:19,439
Speaker 1: into the world in December, and I'm working on turning

812
00:48:19,520 --> 00:48:21,640
Speaker 1: him into a fan as well. Stuff you should know

813
00:48:21,719 --> 00:48:23,600
Speaker 1: has been part of his life since he was a

814
00:48:23,640 --> 00:48:26,520
Speaker 1: wee embryo. We listened to a lot of podcasts during

815
00:48:26,520 --> 00:48:29,440
Speaker 1: my pregnancy. Certainly some of it made it through all

816
00:48:29,440 --> 00:48:33,480
Speaker 1: that amniotic fluid. I'm currently on maternity leave with him

817
00:48:33,480 --> 00:48:36,080
Speaker 1: and we are continuing to listen to the podcast together.

818
00:48:36,400 --> 00:48:37,960
Speaker 1: Have a lot of fun choosing episodes for us to

819
00:48:38,000 --> 00:48:40,279
Speaker 1: listen to. I hope I think I'll do a great

820
00:48:40,320 --> 00:48:43,960
Speaker 1: job sharing information with folks in an accessible and inclusive way,

821
00:48:44,320 --> 00:48:46,960
Speaker 1: and hope that maybe some of this information sticks in

822
00:48:47,080 --> 00:48:51,640
Speaker 1: his subconscious Nothing else hearing else voices and the positivity

823
00:48:51,680 --> 00:48:54,879
Speaker 1: behind them is great for his brain development. And Mom

824
00:48:54,920 --> 00:48:58,160
Speaker 1: gets entertainment too, so everyone wins. Thank you for making

825
00:48:58,200 --> 00:49:01,160
Speaker 1: these hectic days and long nights of new parenthood more

826
00:49:01,160 --> 00:49:04,600
Speaker 1: bearable and for teaching both of us something new every episode.

827
00:49:05,000 --> 00:49:07,600
Speaker 1: Yours truly, it's a great way to sign up. Email.

828
00:49:07,680 --> 00:49:12,279
Speaker 1: By the way, classic Heather and Ronan Man. Apparently dad

829
00:49:12,280 --> 00:49:15,799
Speaker 1: doesn't get any mentioned except turning her onto this thing

830
00:49:15,840 --> 00:49:18,360
Speaker 1: to be in with. He's the og. That's right. That

831
00:49:18,480 --> 00:49:22,320
Speaker 1: was an amazing email. Thanks Heather and Ronan. That was great. Wow,

832
00:49:22,360 --> 00:49:26,839
Speaker 1: thanks to Ronan's dad. Yeah, big thanks to Ronan's nameless dad.

833
00:49:28,480 --> 00:49:30,200
Speaker 1: If you want to get in touch with us, like

834
00:49:30,600 --> 00:49:35,000
Speaker 1: Ronan's nameless Dad's wife Heather did, you can do it

835
00:49:35,040 --> 00:49:37,880
Speaker 1: by email, Wrap it up, spank it on the bottom,

836
00:49:37,920 --> 00:49:44,320
Speaker 1: and send it off to Stuff podcast at iHeartRadio dot com.

837
00:49:44,440 --> 00:49:47,279
Speaker 1: Stuff you Should Know is a production of iHeartRadio. For

838
00:49:47,360 --> 00:49:51,520
Speaker 1: more podcasts my heart Radio, visit the iHeartRadio app, Apple Podcasts,

839
00:49:51,640 --> 00:49:53,480
Speaker 1: or wherever you listening to your favorite shows.