Long Non-Competes

[ETwode]

Thanks for the color everyone.



The sentiment that these are generally not enforceable if >12 months is in line with what I've heard from lawyers. However they also say it is often too expensive to fight as some firms are willing to deploy considerable resources against you. Even if you would eventually "win", it can be dragged out for a while or can bleed you out financially.



Looking around on LinkedIn it's easy to find people sitting out much longer than this, which kind of suggests fighting isn't optimal - any actual examples of things playing out this way? Regardless I'd also be very uncomfortable morally agreeing to an NC with the intention of disputing it if the situation arose, but maybe that's just naive.



It's true that you are paid during the non-compete, but the career impact is much more concerning to me. Seems like one could very easily find themselves forced out of the industry if they come up any short of being a "rockstar" at their first gig.



I am in the US FWIW.

[ronin]

@etwode,



In all seriousness, there are may good reasons to think hard about whether the career in quant trading is worth it these days.



But "will my career be ruined by a non-compete" isn't even in the top ten. If that is your only concern, relax.

[Jurassic]

@ronin statements like this always beg the question. why not? what are these 10 reasons

[gaj]

I don't see why non-compete would ruin your career. Most people I know have worked in more than one shops and they do sit out the non-compete period. It's completely normal and the future employer knows it.

[ronin]

> @ronin statements like this always beg the question. why not? what are these 10 reasons



I thought we'd discussed that topic to death. Have a look at any of the threads about why this forum is dying, what career prospects in quant finance are like etc. I don't have anything specific to add to any of that.

[chiral3]

The fact that you're in the US matters. What I have noticed was a peak, maybe 3-5 years ago, in favor of the employer's whim. I've seen this shift as employers have become perceived, in the court of public opinion, as being too heavy handed. My personal opinion is that the covenants have become insane and basically force everyone to have a discussion anytime you want to do anything practically for perpetuity.



It's important to note that the perceived "fall off" may be due to the fact that everything happens in arbitration now. Proponents will argue that the US court system, and tort law in particular, has become a prolonged money-sucking joke that panders to any grievance, real or imagined, which is true; and that the emergence of arbitration is a positive. I tend to disagree. While the judge used in arbitration is supposed to be impartial, the companies pay well and this could be a recurring gig, so I think these assholes are on it for the money and the process favors the company. On a grander scale, I think that all this bullshit subverts and eschews the legal system.



Anyway, from this I have two bits of advice: first, don't view non-competes in isolation. Consider the entirety of all of the covenants you agreed to in concert. Like kissing cousins there may not be too many branches in that tree and the non-compete, disparage, solicitation, ... may concertize into something very strong. Second, don't assume that you'll have recourse in the courts. You may have agreed to have worked it out in private or in arbitration. I think this is what is happening. It's not that there are fewer cases, it's that companies are going to arbitration and making exaggerated and unsubstantiated claims that your existence outside their firm is a existential threat to their existence that the sanctity of their shareholders. The reality is that at some shops there is a culture of "if you're not going to work here you're not going to work anywhere."



I've always had a lawyer go through my agreements prior to a move.