I said “Hello, anybody home. Think about it. Why would I be under a non-compete agreement if it was going to expire in say a year? If I’m unhappy, then I would leave and work for a competitor after my contract is up. If you want, I’ll bet you $350 that I’m right. How does that sound?”
No, I didn’t say that. As you can see, that wouldn’t make sense.
Of course, you can go through all the legal mumbo jumbo on this case and non-compete lawyers will say that this was a brilliant decision that was made by the judge.
Yes, in one corner, we have one of the largest companies in the country - Reliable Fire - a company that inspects fire extinguishers. Here is a description of the company on their website.
Reliable Fire Equipment Company is the locally and nationally recognized leader in the fire protection industry with over 50 years dedicated to serving the needs of our customers, fire departments and the community.
In the other corner, two former employees - Rene Garcia and Arnold Arredondo - who want to be entrepreneurs who want to start their own business in Chicago.
Once upon a time, America was the land of opportunity.
So, what types of non-compete agreements are out there. There are quite a few. Here are some examples.
First, there are the ones that are for CEO’s, other corporate officers, and employees who have knowledge of inside information in a company. For example, if you’re an employee who works at Nike, your job is for high level access of the latest shoe. Usually, these employees are able to work out a deal with management. They can get a payoff - as much as 2 years of their salary even if they are fired - in order to continue to work there. Like most non-compete agreements, these don’t expire so they are there for the time that the employee is there. If the employee quits or is fired, then the non-compete kicks in and there could be a lawsuit if the employee chooses to work for a competitor.
For other employees in the company, there is another non-compete agreement. It could be for sales people like me in smaller companies or larger companies for that matter. This would also include lower level employees all the way down to the receptionist. We don’t have any inside information that is important since we’re not in board meetings.
The reward for people like me in this contract is that we are able to have the opportunity to work in this company. So, this is where the term, at will employee comes in. You can be fired at any time for any reason and the company doesn’t have to give you anything. Not even a severance package. Your reward is your job.
As we continue through these fair and reasonable non-compete agreements, we move on to local businesses in the area. Non-compete agreements seem to flourish here and why shouldn’t they since they are not regulated by the government, right Tim Allen.
Here are some examples. Pharmacy technicians, salespeople at used car dealers, gym instructors, karate school instructors, hairdressers, dog and cat groomers, maids, people who work at Jimmy John’s and Subway, and let’s not forget a 16 year old teenage girl that worked at a summer camp. Yes a 16 year old girl at a summer camp who isn’t allowed to drink alcohol, who can’t smoke, who can’t vote, but it’s okay for her to sign a legal document. Oh, I almost forgot to mention that these employees can be fired at any time for any reason and they can’t work within a 10-100 mile range from their previous employer. I’m sure at some point, that will go up to 200 miles as well. I mean why not just make it 1,000 miles. I mean, if we can have a contract where a woman from Subway gets fired for being sick and then she is told that she is not allowed to work within 100 miles of a sandwich shop in Michigan - a state that has a new book written about it called Detroit about this state going bankrupt - then why not go for 1,000 miles.
Yes Tim Allen, isn’t it wonderful that these non-compete agreements aren’t regulated by the government. The last thing we need is to have big government regulating this.
Moving on, we can go to the lightweight non-compete agreements. I’m not even sure if these would even qualify as non-compete agreements. Yes, these are the ones that are given to people in the media such as celebrity journalists who work at NBC, CBS, ABC, CNN, Fox News, and CNBC, just to name a few. Now these contracts do expire and from what I understand, they don’t last more than six months to a year, maybe longer in some cases. And the best part is that they expire. Yes, celebrity journalists like Erin Andrews and Katie Couric can leave their stations after their contract is up and move on to another station if they want to. It’s not like those stations are harmed when that happens.
Oh, I’m sorry, I forgot about Shea Allen. She was fired from a local station for misbehaving and wasn’t allowed to work at a local station in her network because she could bring higher ratings to the station. Yes, she was on a non-compete agreement.
Where is the logic here? How does Shea Allen hurt a small local news station when she is fired and isn’t allowed to work at another local station in the area. She can take viewers from a smaller network? Yet when Erin Andrews left ESPN to go to Fox Sports, that didn’t seem to harm ESPN. And when Katie Couric left the Today Show to to go CBS, that seemed to hurt CBS, not NBC.
It would have been nice to see Matt Lauer get to the bottom of this on the Today show. Yes, he took a poll to ask the people if the station was right in firing Shea Allen from her job. He didn’t take a poll though to see if it was fair that Shea Allen was not allowed to work at another station in her local area due to her non-compete agreement. So much for investigative journalism. I’m just an employee on a non-compete agreement. Who am I to tell Matt Lauer what questions to ask.
Here is another important point regarding these non-compete contracts for celebrity journalists. Now if you remember, Ann Curry lost her position on the Today Show to Savannah Guthrie because the ratings were down and she was blamed for this. In January of last year, Ann had asked to be released from her contract at NBC so she could work at CNN. NBC is refusing to do this. Yes, this was news and some publications picked this up. More exciting to read about this than thousands of employees like me who can be fired at any time for any reason and can’t work in the industry for 2-5 years.
Now if you catch the Young Turks video on this subject, you would see that they criticize NBC for doing this. They said that the decent thing for NBC to do is to let her go from her contract. It’s not like she can quit because if she does, then she could not work at another network until her contract is up. So she needs to finish out her contract before she works at another station like CNN.
Of course, the Young Turks continue to say that they understand the reason why it is necessary for NBC to have this contract. The reason is that if Ms. Curry wasn’t under contract, then she could screw NBC whenever she wants and would work for GMA . Not sure I understand the logic behind that since she was blamed for NBC’s loss in ratings but who am I to make sense of non-compete agreements and the things celebrity journalists talk about.
Obviously, I disagree with everything the Young Turks said. Here’s why.
Let’s say that Ann Curry wasn’t under a non-compete agreement. So, she leaves the station on her own and goes to work for CNN. Now, what guarantee do you have that their ratings will go up as a result of her joining this station. None. We really don’t know what will happen if she joins CNN or GMA. For all we know, it could be a bust like when Katie Couric left NBC to go to CBS. Again, where is the logic as to how the ratings will improve at CNN and GMA when she was blamed for losing ratings at NBC.
Of course, a non-compete lawyer will argue that Ann Curry is getting a reward for her non-compete agreement which is a salary of $12 million dollars a year. NBC