U.S. bans noncompete agreements for nearly all jobs
The Federal Trade Commission narrowly voted Tuesday to ban nearly all noncompetes, employment agreements that typically prevent workers from joining competing businesses or launching ones of their own.
Would this also apply to a contracting agency that has a noncompete document that had to be signed by their contractor employees?
The noncompete is so that the contracting employee can't end the contract early and then be hired directly by the company they were being contracted to. At least not for at least a year after ending the contract unless the length of the contract was completed in full.
Edited for clarity
I think so, yes. If you read the actual rule (https://www.ftc.gov/system/files/ftc_gov/pdf/noncompete-rule.pdf) it says a noncompete is something against "seeking or accepting work in the United States with a different person". Since you're working in the first part with a contracting agency, and then going to work with a different company, the rule seems applicable here.
I'm not sure why they use "person", but I'm assuming your W-2 or 1099 would have different companies, and the different companies would have different presidents/CEOs/chairmen, so it would objectively be different both in the general legal Romney-style "corporations are people" person and the literal dictionary person.
I’m not sure why they use “person”, but I’m assuming your W-2 or 1099 would have different companies
Yes, those documents list the contracting agency as the company one is working for, rather than the company one is being contracted out to.
That's exactly what a non-compete is. Your job can no longer stop you from quitting and working for a competitor.
Not a competitor, but the company you were working at with the contracting agency. Basically trying to stop being a contractor and trying to be hired directly as a colleague.
Of course, if the company made you sign the non-compete clause, and you try to get hired directly by the company that made you sign it, they could just establish a internal rule saying "don't hire contractors". Nothing is forcing them to hire you.
I think you misunderstood. The contracting agency has the noncompete clause in their contract. To prevent you from being able to cancel your contract part way through and get a real job at the company you're being contracted out to.
Ah, like a job finding firm that sets you up, takes a percent of the pay - and if you just quit and join the company directly they loose their cut?
Yes, exactly. They have a separate clause in their contract that makes it so you can't be hired at the company you're being contracted to until you're most of the way through your contract (or the company has to pay the contracting agency a decent chunk of change if they really want to hire you on early).
And the noncompete is an additional document to prevent you from just ending your contract early and applying for the real position at the company without that issue.
Basically the contracting agency trying to get as much money as possible. Even while offering the most minimum of worker benefits they can legally manage.
I'm not a lawyer, but I'd imagine that would also be banned. You'll have to see if you get a notice from the agency
That's a good question (but you might want to rephrase it to something clearer).
I think he's asking about temp to hire, the employee being given an offer, but only if they quit and quit looking through the temp to hire agency, then get picked up by the company they were working for (before the 1 year that the temp to hire would be collecting commission on)
But I don't have the foggiest what the answer would be
The answer is "fuck em". If your business model requires restricting the rights of people, your business shouldn't exist
They can still function as a staffing agency...
Basically yes but I get the impression he means more than labor or basic admin, which I'm not too familiar with. For the basic stuff I believe the company pays the temp agency a small fee. From what I've seen the temp agency doesn't really care about retaining people so they just roll with it.
Basically a lot of the low level jobs are contractors. And you can eventually be hired by the company as a colleague once your contract is up. The contracting agency, however, put in a noncompete clause so that the contractors can't end their contract early in order to apply for that company's colleague position.
Isn’t that scenario a dispute between the contracting company and its customer? How is the employee even involved? Contracting company should have a term in their contract with their company how to handle that situation