[Leaplist] [OT/PD] "Apple Exec Hired From IBM Ordered to Stop Work"

[Steve Litt]

On Tuesday 11 November 2008 12:06:32 pm Bryan J. Smith wrote:

> "Apple Exec Hired From IBM Ordered to Stop Work"
>   http://www.pcmag.com/article2/0,2817,2334163,00.asp
>
> Companies pull Non-Competes on former employees regularly.
> Most of the time, the two companies (former and new) work
> out a "deal," often a monetary and contractual agreement,
> that allows the change of position of the employee when they
> are "uniquely qualified/knowledgeable."  But sometimes you
> get what we have here with an ex-IBM employee who IBM just
> does not want to let go.
>
> Non-Competes _are_ enforceable.  

Here is the text of Mark Papermaster's non-compete:

http://blogs.zdnet.com/BTL/images/papermaster2.pdf

As you read Mark's contract, notice that the second he signed it, he was IBM's 
slave. IBM no longer had an incentive to give him raises -- where else would 
he go for a salary? IBM no longer had an incentive to treat him well -- 
where's he gonna go? From the moment he signed that agreement, Mark 
Papermaster's alternative to IBM was to open a restaraunt or become a fitness 
coach.

Read your contract! A couple clauses in a contract can change that dream job 
into slave labor or worse. Wait til you get one of those clauses stating that 
anything you think up during your employment period and for two years after 
termination, on or off the job, whether relevent to your job or not, belong 
to the company, and you must affirmatively assist in patenting or 
copyrighting what you thought up and turn it over to the company.

If you're a contractor, watch out for that bankruptcy maker, the 
indemnification clause. They'll tell you verbally it simply says you won't 
sue them (which is bad enough -- their ceiling falls on your head due to 
negligent maintenance and you can't sue), but it's much more than agreeing 
not to sue them. If a third party sues them, ALLEGING that something you were 
involved in caused damage to the third party, YOU must defend the company 
including legal fees and remuneration to the third party. The company decides 
the legal defense at its sole discretion, but YOU foot the bill. You're an 
unpaid insurance company, insuring a megacorporation with the equity in your 
house, your childrens' college fund, and your 401K.

And then there's that innocent sounding nondisclosure agreement. Certainly 
it's unethical to disclose the secrets of the company who fed and clothed you 
and your family. But most nondisclosure agreements are crafted so broadly as 
to function as noncompete, perhaps ruining your chances to continue working 
in that field. Imagine if architects had to sign a document that no future 
house would have the unique features of your house. He'd never build another 
house.

I've lost tens of thousands of dollars refusing troubleshooting course 
contracts with indemnification, noncompete, overly broad non-disclosure, 
and "your inventions belong to us" clauses. That's OK. I sleep well at night, 
knowing that 2 years from now some corporation isn't going to tell me I have 
to pay to defend them against a frivolous lawsuit. Knowing that every time I 
teach a course and come to some new realization about troubleshooting, I can 
use that realization in my next class. Knowing that I can keep writing books, 
and no corporation who thought they were being generous paying me $6,000 is 
going to claim copyright on that book.

By the way, I've also had many customers say "OK, you don't have to sign, just 
come teach troubleshooting" when it was clear they wouldn't have my services 
if they insisted on such crazy contracts.

A lot of people say you can't work without signing such contracts. First -- 
that's not true -- a lot of small companies don't require them. Second, why 
do you think such boilerplate is so common? It's because everyone just holds 
their nose, signs it, and hopes they don't end up like Mark Papermaster. If 
technologists refused to sign the worst of such contracts, corporations would 
understand that there's pain involved in such gratuitous boilerplate, and the 
worst of it would disappear.

I'll tell you a little story. In 1989 I was a contract programmer for a large 
law firm. They decided to have all IT employees and contractors sign a 
contract with a broad and severe noncompete that would have left me unable to 
work for others.I gave the IT director an alternative contract saying I 
wouldn't disclose company secrets. He handed it back to me and scornfully 
said this was a professional law firm and he'd accept only the original.  
Every single mainframe programmer just signed this horrible contract, but a 
few of us PC types got together, consulted a lawyer, and basically said "no". 
The IT director called a meeting, sat us down, and basically said "sign or 
you're gone". My key card was in my hand, ready to throw at him if he backed 
me into a corner. But he didn't. A couple weeks later there was another 
meeting, where they basically said "you don't have to sign this, but you'd 
better not disclose our secrets, because getting sued by our firm will be the 
worst thing that ever happened to you". I was free to work elsewhere, and 
worked elsewhere often during the 10 years when the law firm was my client.

Read all the paperwork you'll be required to sign before giving notice at your 
current company. The wording of that contract is every bit as important as 
the training they'll give you, the kewl new technology you'll get to work 
with, the great health plan they offer, or the status of working for their 
company.

SteveT

Steve Litt
Recession Relief Package
http://www.recession-relief.US


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