SERVING THE QUANTITATIVE FINANCE COMMUNITY

 
User avatar
MiloRambaldi
Topic Author
Posts: 273
Joined: July 26th, 2010, 12:27 am

Post-employment convenant

June 12th, 2015, 11:20 pm

Is this the norm for a trading firm? For up to 2 years after employment terminates with the company, they have the option of paying you the (low) base-salary and in return requiring that you abstain from participating in any trading activities with any competitors.
Last edited by MiloRambaldi on June 12th, 2015, 10:00 pm, edited 1 time in total.
 
User avatar
Hansi
Posts: 3300
Joined: January 25th, 2010, 11:47 am

Post-employment convenant

June 12th, 2015, 11:37 pm

Depends on the firm, there are a few firms that do this, but depends on the size, asset class, strategy etc.A check on older threads may be in order: https://www.google.co.uk/search?q="non- ... ilmott.com
Last edited by Hansi on June 12th, 2015, 10:00 pm, edited 1 time in total.
 
User avatar
WFNYC
Posts: 32
Joined: February 16th, 2015, 11:07 am

Post-employment convenant

June 13th, 2015, 2:36 am

My partner's non-compete was for 5 years. If they really want to enforce it they would be paying you more than a low base.
 
User avatar
andyusa1
Posts: 7
Joined: November 13th, 2011, 12:17 am

Post-employment convenant

June 13th, 2015, 6:32 am

How do they define "competitors"? Is it possible to negotiate on the non-compete duration and the pay, at the time of signing the job contract?
 
User avatar
WFNYC
Posts: 32
Joined: February 16th, 2015, 11:07 am

Post-employment convenant

June 13th, 2015, 8:55 pm

If they are paying you to not compete then you have to ask them if you can do whatever it is you want to do. It could be as general as any type of trading related to the use of algos. They are paying you so pretty much they determine everything. Of course you can do whatever you want if you don't care about not compete paychecks. Then the lawyers will have to get involved if they think you stole something.
 
User avatar
bearish
Posts: 5627
Joined: February 3rd, 2011, 2:19 pm

Post-employment convenant

June 14th, 2015, 12:41 am

I am afraid this is one of those situations where the jurisdiction is very important, the opinion of random people on the internet should be discounted, and reassuringly expensive employment lawyers are de rigeur.
 
User avatar
MiloRambaldi
Topic Author
Posts: 273
Joined: July 26th, 2010, 12:27 am

Post-employment convenant

June 14th, 2015, 3:31 am

QuoteOriginally posted by: WFNYCIf they are paying you to not compete then you have to ask them if you can do whatever it is you want to do. It could be as general as any type of trading related to the use of algos. They are paying you so pretty much they determine everything. Of course you can do whatever you want if you don't care about not compete paychecks. Then the lawyers will have to get involved if they think you stole something.No, that's not the stated condition. If they enforce the non-compete they agree to pay, but I do not have the option of deciding not to accept payment so that I can compete.
 
User avatar
MiloRambaldi
Topic Author
Posts: 273
Joined: July 26th, 2010, 12:27 am

Post-employment convenant

June 14th, 2015, 3:34 am

QuoteOriginally posted by: bearishI am afraid this is one of those situations where the jurisdiction is very important, the opinion of random people on the internet should be discounted, and reassuringly expensive employment lawyers are de rigeur.Definitely, and a good lawyer, not merely expensive.I've been trying to research on my own but the jurisdiction issue is confusing. I guess it depends on what country the contract is signed in, rather than the country you are competing in after the termination of employment? I haven't been able to find information on enforcing a non-complete globally.
 
User avatar
WFNYC
Posts: 32
Joined: February 16th, 2015, 11:07 am

Post-employment convenant

June 14th, 2015, 6:11 pm

QuoteOriginally posted by: MiloRambaldiQuoteOriginally posted by: WFNYCIf they are paying you to not compete then you have to ask them if you can do whatever it is you want to do. It could be as general as any type of trading related to the use of algos. They are paying you so pretty much they determine everything. Of course you can do whatever you want if you don't care about not compete paychecks. Then the lawyers will have to get involved if they think you stole something.No, that's not the stated condition. If they enforce the non-compete they agree to pay, but I do not have the option of deciding not to accept payment so that I can compete.How would they stop you from competing if they don't pay you?
 
User avatar
bearish
Posts: 5627
Joined: February 3rd, 2011, 2:19 pm

Post-employment convenant

June 14th, 2015, 7:43 pm

QuoteOriginally posted by: MiloRambaldiQuoteOriginally posted by: bearishI am afraid this is one of those situations where the jurisdiction is very important, the opinion of random people on the internet should be discounted, and reassuringly expensive employment lawyers are de rigeur.Definitely, and a good lawyer, not merely expensive.I've been trying to research on my own but the jurisdiction issue is confusing. I guess it depends on what country the contract is signed in, rather than the country you are competing in after the termination of employment? I haven't been able to find information on enforcing a non-complete globally.There is definitely information out there, but it is murky at best. 2 years does sound like an unusually long time though. A little poking around produced one brief summary that may be relevant Non Compete.
 
User avatar
katastrofa
Posts: 9335
Joined: August 16th, 2007, 5:36 am
Location: Alpha Centauri

Post-employment convenant

June 16th, 2015, 4:36 am

Similar clauses in employment contracts are meant to intimidate the employee, while they have no legal power. Enforcing a few months of a fairly compensated non-compete period would stand in the court, but anything longer than that is obviously harmful to your career (it reduces your employment prospects) and hence abuses your fundamental right to earn bread. If you breach the clause, you may still receive a solicitor letter on behalf of your former employer and need to respond reiterating your case, but they won't go further with it to make what would amount to frivolous legal threats. Of course, like virtually everything in the law, this is some sort of a grey zone and as recommended above you should always consult a lawyer in such situations (or prior to signing the contract if in doubt).
 
User avatar
lexington
Posts: 321
Joined: November 16th, 2008, 5:04 am

Post-employment convenant

June 16th, 2015, 12:49 pm

QuoteOriginally posted by: katastrofa Similar clauses in employment contracts are meant to intimidate the employee, while they have no legal power. Enforcing a few months of a fairly compensated non-compete period would stand in the court, but anything longer than that is obviously harmful to your career (it reduces your employment prospects) and hence abuses your fundamental right to earn bread. Not in the US.Citadel sues former employees who set up Teza Tech
 
User avatar
WFNYC
Posts: 32
Joined: February 16th, 2015, 11:07 am

Post-employment convenant

June 16th, 2015, 5:48 pm

QuoteOriginally posted by: lexingtonQuoteOriginally posted by: katastrofa Similar clauses in employment contracts are meant to intimidate the employee, while they have no legal power. Enforcing a few months of a fairly compensated non-compete period would stand in the court, but anything longer than that is obviously harmful to your career (it reduces your employment prospects) and hence abuses your fundamental right to earn bread. Not in the US.Citadel sues former employees who set up Teza TechThis is actual theft.
 
User avatar
lexington
Posts: 321
Joined: November 16th, 2008, 5:04 am

Post-employment convenant

June 17th, 2015, 7:33 am

QuoteOriginally posted by: WFNYCQuoteOriginally posted by: lexingtonQuoteOriginally posted by: katastrofa Similar clauses in employment contracts are meant to intimidate the employee, while they have no legal power. Enforcing a few months of a fairly compensated non-compete period would stand in the court, but anything longer than that is obviously harmful to your career (it reduces your employment prospects) and hence abuses your fundamental right to earn bread. Not in the US.Citadel sues former employees who set up Teza TechThis is actual theft.sued a former top executive in its highly successful quantitative trading unit and two others for setting up their own firmformer employees had violated their non-compete clauses by starting their own firm
 
User avatar
WFNYC
Posts: 32
Joined: February 16th, 2015, 11:07 am

Post-employment convenant

June 17th, 2015, 9:58 pm

QuoteOriginally posted by: lexingtonQuoteOriginally posted by: WFNYCQuoteOriginally posted by: lexingtonQuoteOriginally posted by: katastrofa Similar clauses in employment contracts are meant to intimidate the employee, while they have no legal power. Enforcing a few months of a fairly compensated non-compete period would stand in the court, but anything longer than that is obviously harmful to your career (it reduces your employment prospects) and hence abuses your fundamental right to earn bread. Not in the US.Citadel sues former employees who set up Teza TechThis is actual theft.sued a former top executive in its highly successful quantitative trading unit and two others for setting up their own firmformer employees had violated their non-compete clauses by starting their own firmTheft part is the key to this case.
ABOUT WILMOTT

PW by JB

Wilmott.com has been "Serving the Quantitative Finance Community" since 2001. Continued...


Twitter LinkedIn Instagram

JOBS BOARD

JOBS BOARD

Looking for a quant job, risk, algo trading,...? Browse jobs here...


GZIP: On