Prepare to be shocked: Employees hate this One Weird Clause

Wish you could IP Freely? What's the wording holding you back in your current job?

Poll As PayPal and NetApp join the latest tech multinationals shedding a portion of their staffers, the US Federal Trade Commission is proposing a local ban on non-competes.

America's federal regulator has concerns about the unequal bargaining power between employers and workers, claiming that non-compete clauses limit a worker's ability to practice their trade. On the other side, the US Chamber of Commerce has threatened to sue the FTC over the proposed ban.

What is a non-compete?

A non-compete clause is a contractual term between a worker and their employer that typically blocks the staffer from working for a rival or starting a competing business after the employment contract ends. This is always limited to a set amount of time (under a year, usually) and sometimes to a specific geographical area.

But non-compete clauses – also in wide use across Europe, including in the UK and even Germany (which expects businesses to pay half the ex-employee's former salary in the period the non-compete applies) – are not the only contract terms that have come under the magnifying glass as workers consider their next moves. Even those not affected by the cuts are feeling the cold winds as hedge funds gain influence, claims of impending recession continue (along with the hike in interest rates), and corporate culture decides to draw a line under the pandemic WFH policies, regardless of concerns over spread. Those who are looking to move will naturally be reading the fine print of their contract quite closely.

Global employment in the ICT sector hit approximately 55.3 million across the globe in 2020, and US Bureau of Labor statistics from the end of last year revealed that tech companies added 14,400 workers in November alone, with tech sector employment increasing by 207,200 in 2022. In the EU, jobs in ICT have grown 22 percent in the past five years, with tech workers estimated at 1.35 million people and demand for techies outstripping supply.

So the recent job cuts, although they number in the tens of thousands over the last six months, and have been personally horrific for many readers, are not necessarily a portender of gloom for the tech sector worker, employment figures suggest.

The unemployment rate for US tech workers went down to 2 percent from 2.2 percent last year, say the figures, despite Silicon Valley's axe-wielding. That said, if you have been affected by the cuts, that will be of cold comfort until you find something new. Not "MLK quote"-congratulating-yourself-on-your-bravery-in-firing-people level cold, but cold nonetheless.

And for some jobseekers, those old contractual clauses – and the new ones from prospective employers – will be meaningful as they look to move on. If you don't have a lawyer on hand, the big ones to look out for are restrictive covenants, terms of dismissal, and – of course – salary and incentive structures. Having a job description spelled out also helps, as many a put-upon reader has told us.

Not all contracts are well-drafted, of course, and not all clauses are enforceable under the law, especially if the employer isn't fully aware of local rules (*cough* Elon Musk *cough*).

What's the worst clause in an employment contract you've seen in your career or someone else's? You don't need to name names, though we couldn't help but remember Evan Brown, who was forced to sign away his right to an invention he'd never even written down or programmed until after his employment with Alcatel-Lucent ended because he'd had the idea while he worked there. We've added some of the most-hated ones we've heard readers complain about – we'd love to hear more of yours below. ®

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