According to the FTC, approximately one in five U.S. workers — around 30 million — are working under noncompete clauses in their current jobs.
Many companies in the tire industry require these noncompetes from workers, particularly tire makers that understandably want to preserve and protect their intellectual property. It makes perfect sense for a tire maker to require engineers, for example, to sign a noncompete — imagine laboring months to complete a product, only to have a competitor lure a key employee who helps the company develop a similar product twice as fast or share crucial trade secrets.
Three states — California, North Dakota and Oklahoma — already ban them, while several others allow them with limitations.
The noncompete clause won't go down without a fight — or three. The U.S. Chamber of Commerce filed suit against the FTC in the Northern District of Texas on the same day that the Final Rule was published, according to published reports.
Some believe the ruling eventually will be decided by the Supreme Court.
This is a difficult issue, one that elicits strong opinions either way.
On one hand, why should a company prevent a worker from earning more money and advancing his career by jumping to another job?
This issue has been brewing in the sports world since, it seems, the Greeks held the first Olympics. Professional sports leagues used to monopolize an athlete's career indefinitely once they were signed and/or drafted.
It still happens today: Pro leagues draft amateurs, and those amateurs usually are bound to those teams, unless the team decides otherwise.
However, with the advent of free agency across pro sports, athletes are free to follow the money. Akron's own LeBron James changed the landscape forever in 2010, when he famously announced he was "taking his talents to South Beach."
As a Cleveland fan, I was disappointed, yet I always felt if I could choose to work where and with whom I wanted, why shouldn't professional athletes?
Even college athletics have followed suit, with the transfer portal. A disgruntled college athlete need only to enter the portal and choose another school and/or program to continue his or her career, without any ramifications.
Why should other industries be different?
On the other hand, why should a company want to invest thousands of dollars of resources to train a key employee, only to watch them jump to a competitor and compromise its intellectual property?
And should government delve into the business of businesses anyway?
The noncompete clause also reaches into journalism. I know colleagues who have signed noncompetes, preventing them from working for a competitor, whether the employer was relieved of his or her duties or left on their own volition.
It will be interesting to see how this plays out.
The U.S. Tire Manufacturers Association, comprised of the major tire makers, said it won't take a position on the issue.
What do you think?
Email me at [email protected] with your thoughts.
