When stupid HR results in new laws

by Michael Haberman on June 23, 2015 · 0 comments


It is not necessary to have this employee sign a non-compete. If he was bad enough to let go it is to your advantage to let him work for a competitor.

It is not necessary to have this employee sign a non-compete. If he was bad enough to let go it is to your advantage to let him work for a competitor.

I think there is already too much employment related legislation, so I hate it when stupid HR practices prompt legislators to introduce legislation to counteract the stupid HR practice. But alas…

No good reason

A group of Democrat Senators have introduced the MOVE Act, short for the Mobility and Opportunity for Vulnerable Employees Act. This was introduced to provide protection to lower wage workers from non-compete agreements required by their employers. This was in reaction to Jimmy John’s use of non-compete agreements among rank-and-file employees. According to attorneys Ellen Shulock Caro and Michael WeilThe provision in question prohibits former employees for two years from working at any food service venue that derives 10% or more of its revenue from the sale of ‘submarine, hero-type, deli-style, pita and/or wrapped or rolled sandwiches’ within three miles of a Jimmy John’s location.” Really? You want to prevent a sandwich maker from working within three miles of a location they had worked at for you? I don’t know about you but I cannot think of a good reason for that worker to sign that non-compete.

As a result

As a result of an HR practice, which to my way of thinking is pretty nonsensical, we now have legislators on a federal level trying to introduce legislation to protect lower wage workers. The legislation, however, goes beyond that and would require employers to disclose to ALL workers whether or not they would be required to sign a non-compete prior to making an offer of employment.

In reality, most non-competes are handled at the state level and their legality will vary state-by-state. Some states already ban them. There is no need for federal legislation, yet it has been introduced.

What will happen?

It is unlikely this legislation will pass in the current Congress, fortunately. But what this does is raise the awareness of the issue which may result in more state actions adding further restrictions to the use of legal documents like non-competes. An attorney friend of mine, one who represents businesses, said he thought non-competes were bad for business in general. I think there may be some justification for them but in very limited circumstances. Having the sandwich maker, the dishwasher, the busboy, the person that mops the floor, and others at that level sign a non-compete is just STUPID HR.

Stop it! It just results in more crap employment law.


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