Contracts you should never sign | Hacker News Reader

Contracts you should never sign

vadimkravcenko.com

308 pointsbndr270 comments

Treat contract negotiation as a trial run for your future relationship: Do they try to slip nasty stuff in there? Do they do stupid shit? Do they refuse to answer questions clearly? Is it a hassle trying to get them to make modifications? Are things vague, open to too much interpretation, or missing key information?

How someone behaves during contract negotiations is an indicator of how they'll behave generally. If you can't start building that trust right out of the gate... Red flag. Even if they're not trying to be devious and are simply being naive or sloppy.

Exactly!

It has gotten to the point where I take any contract put in front of me as a statement of how the other party does business. If they contract is all one-sided to their benefit and/or has crazy escape hatches for them and/or penalties for my side, it's best to just walk away, even if it costs a lot. I've tried to negotiate such clauses into something reasonable, and it is just a waste of time. They've told you how they do business the first time — believe them the first time.

When I write contracts, I make sure that they are mutual, down to the structure of every sentence and paragraph. E.g., "Both parties shall treat confidential information with the same care as their own confidential information..." in an NDA for prospective joint development. I'm not the only one, and I've seen that sort of approach many times ('tho less often that I'd like). Those are the kind of people/companies I want to do business with.

Avoid the former like the plague that they are. You'll save yourself a lot of trouble.

What? Every click wrap agreement online is very one sided. You think you're saving yourself trouble by not using any online software?

They are still right about EULAs. The terms and style of negotiation are "we do what we want and change things when we feel like it, and you check accept or stop using the software," and guess what that implies about using the software - they do what they want and change stuff when they feel like it and you accept it or stop using the software.

Contrast that to the open source pattern of making the license a header in the source files. You interact with the license by making common sense assumptions unless you need to know a detail, in which case you open a source file. Likewise you interact with the software by running on common assumptions unless you need to know a detail, in which case you open a source file.

I agree that, from the user perspective, I'd prefer if all of the software terms and EULAs I sign online were more favorable to me.

But I think it's a major overstatement to say you'll save yourself a headache by not agreeing to one-sided terms. They are literally everywhere. This very website we're posting on right includes these terms in its terms of service:

We reserve the right, at our sole discretion, to change or modify portions of these Terms of Use at any time.

YOU WILL ONLY BE PERMITTED TO PURSUE CLAIMS AGAINST Y COMBINATOR ON AN INDIVIDUAL BASIS, NOT AS A PLAINTIFF OR CLASS MEMBER

Y Combinator reserves the right to modify or discontinue, temporarily or permanently, the Site (or any part thereof) with or without notice.

Y Combinator reserves the right to investigate and take appropriate legal action against anyone who, in Y Combinator’s sole discretion, violates this provision, including without limitation, removing the offending content from the Site, suspending or terminating the account of such violators and reporting you to the law enforcement authorities.

Indeed. This is the classic hole in the economics argument about market forces. You can easily set up a game theory model of the prisoner's dilemma with many players, in which the payoff from deviating is so small that "everyone colludes" becomes a stable equilibrium.

>They've told you how they do business the first time — believe them the first time.

I'm agreeing more with that than the idea that there are no good nonmutual commercial interactions.

I’d be a little more worried about HN’s terms and conditions if I had to pay to use the site. There’s a world of difference between someone (or a company) who is providing a free service attempting to shield themselves from expensive litigation and generally insisting the free service be as hassle-free for them to run as possible and a a company charging me money for a product or service and putting these kinds of one-sided terms in a EULA.

The thing about online service agreements is they have pretty much zero leverage against you. So what if you violate their little terms of service? Worst they can do is ban your account. Their "take it or leave it" bullshit holds no water.

This depends on the nature of the transactions you're performing.

For example, play that game with Paypal.... whoopsie, they're holding a quarter million of your cash and aren't going to let it go for six months. Of course where this much is at stake reading those agreements is very important.

But take a middle ground. You join a forum and make a side business where you're selling some kind of product to their members. This gets more problematic very fast. It can be nearly impossible to pull your business out of the forum it's embedded in. And this is the exact kind of behaviors we've seen out of large companies like Facebook. They can choose how they please to access 'their' users.

Of course. If you have hundreds of thousands of dollars in a PayPal account, they have the highest possible leverage over you: they are literally holding your money. If you have a Steam account with hundreds of video games on it and an estimated value of tens of thousands of dollars, you're obviously not going to screw around and risk getting banned. Once money has exchanged hands, it becomes serious business.

There's no reason to care about some random blog or forum's terms of service though. Block their ads and surveillance capitalism all you want, they can do nothing.

don't bother with a cell phone either. the world is full of stupid contracts with unenforceable terms. sign it without reading and save yourself the headache.

I'm obviously not talking about click wrap agreements; I'm talking about in-person negotiations.

The click-wrap "agreements" are all bullsh*t "adhesion contracts", and in that context are virtually unenforceable.

That said, yes, I will strongly prefer to work with software that doesn't have such nonsense when possible. E.g., I've used LibreOffice for decades to avoid M$ office (which I can also watch family & friends who are stuck from work just become increasingly annoyed at how bad it gets — strong correlation).

And yes, I do save myself a LOT of trouble by avoiding online-only or unnecessarily online software, keeping as much as possible to locally-running software. No, I'm not going to use your online project management, or charting, or whatever, unless I can get a direct benefit from the online aspect that is not otherwise available (e.g., simultaneous team editing, etc.)

If they are making an obvious effort to tie your hands, it is because they lack the confidence that their product is good enough to willingly keep using it. Once again, you should believe them the first time they tell you.

Microsoft with the dollar sign, M$. How clever! Bet you had a ton of karma on Slashdot

That's a name I haven't heard in a very long time....

(as in I haven't been on or even thought about Slashdot for well over a decade. But, apparently, in your limited world, someone cannot use a common vernacular to maybe help make a point without being accused of karma-whoring, which is clearly what is on top of your mind. You really think your comment adds value to the discussion; if so, how?)

Strongly agree, noticed this when signing lease agreements. Currently leasing from a place with tons of one-sided rules, fines, surprise fees, etc, and they've been awful to deal with overall.

I signed another lease recently with more sane rules and enjoyed living there a lot more than I enjoy living at the other place.

There's another side to this: corporations are not people, your champion may be a person but when they're gone next year your contract is with the corporation, and the only "behavior" you can expect is for it to optimize future cashflows. Do you want the money or not?

You can generalize that to:

The way they treat you when you're interviewing is the best they will ever treat you.

Are they rude? Ditch 'em.

Do they stare at your resume like it's a pile of dog doo? Ditch 'em.

Do their interviewers interrupt you while you're answering their question, to ask you another one? Ditch 'em.

Do they ignore your personal needs (water, bathroom, etc.)? Ditch 'em.

(and as you said, do they give you lengthy contracts to sign with onerous provisions? You know this by now.)

I like this, and it rings true in my experience. It's like you're both on a first date. If it goes well you might have the opportunity to grow something deep and meaningful. If it goes poorly because one party behaves badly, it could be a one-off, but it's far more likely to be a warning sign. Cut your losses!

> the best thing we as engineers can do is be aware of the types of contracts we're signing

I'd argue that the best thing we can do is to not just make generalizations about what is OK to sign or not. Confidentiality agreements and non-competes are fine if they are narrowly focused, fair, and your compensation is sufficient to make it worth the restrictions. Because that is what a contract really is - a balancing act between obligations and limitations put on yourself contrasted with benefits (money) given to you in exchange.

So an absurd non-compete is fine if they pay me a lot of money for it. An confidentiality clause is fine if they pay me a lot of money for it.

This becomes critical when looking at all the recent layoffs. Most severance packages are exactly this type of contract - confidentiality and other restrictions in exchange for your severance pay.

Should you sign? Maybe. Maybe the severance pay is worth it. Read the contract, understand it, and make a choice.

(also worth taking into account whether clauses like an absurd non-compete are even enforceable...)

OK, but that's REALLY hard to assess for a normal person on their own.

Moreover, it doesn't prevent unreasonable entities from having their retained lawyers draft scary letters. Most people just sign the boilerplate, hope for the best, and try not to poke sticks into wasp nests if they can avoid it.

But at software engineer salaries, it's not that expensive to get legal advice for this. I did it once, when a company I'd worked at for over a decade was bought out, and insisted everyone sign onerous contracts including broad IP assignment. I read the contracts carefully, marked them up with specific questions, and spent $300 on a half-hour consult with a lawyer, who said it was pretty much all enforceable in my state. (So I left the company, which worked out fine.)

One question/comment here, I don't think they can force you to sign a new one in most states without giving you something in return. I know someone who refused to sign a new contract because they didn't give him anything in return, and there was nothing they could do about it, or at least there was nothing they did do about it.

Hah interesting. My lawyer didn't mention that so maybe my state was an exception. Or, our employers can fire us anytime for any reason so maybe he figured it would be impractical to litigate.

It is dishonorable to sign an agreement knowing you won't adhere to your end because it's unenforceable.

After all, we make promises all the time that are unenforceable, but we keep them.

It's even more dishonorable for a company with a legal team to offer up terms in a contract that are explicitly illegal, and then use those illegal terms to conduct unfair and deceptive business practices in the labor market.

In fact, that scenario is so dishonorable that in some states you can ask the court for triple damages if the employer tries to enforce the noncompete

Your having honor is not conditional on others having honor.

There is no honor is dying on an ER stretcher.

For anyone in the US who needs regular healthcare beyond what's provided by Medicaid, the labor market is a war for (literal) survival. If the ownership class didn't want to return to an extremely adversarial relationship with labor, then they shouldn't have gutted the social safety net.

And no, I'm not going to show my hand in an imperfect information game... it would be stupid and dishonorable to my family to present with anything other than bourgeoisie professional-managerial class sensibilities.

Right on, stick it to the man

Honor is what separates men from animals. Each of us gets to choose which we are.

Did you just insinuate I'm subhuman because I don't bend over when a megacorp insists that I sign an unenforceable noncompete?

Cooperating against a defect-bot is not an indication of honor.

That's like saying, "it's dishonorable to agree to a contract to kill someone knowing full well such a contract isn't enforceable."

If one party holds all the cards in a contract negotiation it's never truly being negotiated in good faith in the first place. Furthermore, one could argue that without having an expert on contract law right then and there available to answer any questions about any given contract means it falls under a "lack of capacity" for basically anyone who isn't a lawyer.

Employee agreements often fail in courts because of:

    - Duress
    - Lack of capacity (e.g. due to overly complicated legalese *specifically written to be hard to understand*)
    - Undue influence (e.g. company says they'll hire someone else if you ask to get the contract reviewed by a lawyer before signing)
    - Misrepresentation (e.g. job was described as "X" but turns out it's "Y")
    - Non-disclosure (e.g. candidate was not told job would require purchasing products or services sold by the company itself or a partner)
    - Unconscionability (e.g. some term or terms in the contract are so unfair that it cannot be allowed to stand... Like a non-compete that says you can't work within 50 miles of your former place of employment if you leave)

The "usual one" is unconscionability: Employers have unfair bargaining power almost all of the time and judges and juries are easy to convince of this. Also, these sorts of things don't usually make it to court unless there's something ridiculous in the contract. What's interesting is there usually is something ridiculous in every employee contract. It's just that those ridiculous things aren't usually the part of the contract a company is trying to enforce so they don't come up as often.

Dishonorable? I don't think so. They're the ones trying to trick employees into immoral and illegal obligations. They only have themselves to blame if it blows up in their faces. They played the game and they lost.

An honorable person would refuse to sign such an agreement, or would honor it, enforceable or not.

Nobody is making you sign it.

If an agreement is unenforceable, it's almost certainly abusive and exploitative in nature. I mean, it actually got to the point that the agreement was overridden by law. Doesn't even make sense to talk about honor in the same context. Would honorable people propose such an agreement?

They're likely banking on that sense of honor to make you hold yourself to obligations they can't legally hold you to.

I agree. My contract says that my employer can choose to enforce a non-compete for 12 months after I leave, but if they do, they have to pay me during that time. It creates a strong incentive for them to not abuse the non-compete.

Are you in finance? That kind of compensated-non-compete seems common there, but rare elsewhere.

A garden leave clause is literally required for any noncompete contract to be enforceable in MA [1]. Hilariously, none of the FAANG companies include a garden leave clause for MA employees. NB: giving post facto garden leave isn't enough to enforce a non-compete; an actual clause needs to be in the signed noncompete contract in order for the contract to be enforceable.

My employment lawyer friend is fairly certain that if a FAANG tried to enforce a noncompete without a garden leave clause, they could be sued for triple damages, where the damages would certainly include the minimum required garden leave, and that if the enforcement attempt resulted in a job opportunity being aborted you could probably also include the full vesting schedule of your next employment contract in the damages (which, again, gets tripled).

[1] M.G.L Chapter 149 Section 24L:

(b) To be valid and enforceable, a noncompetition agreement must meet the minimum requirements of paragraphs (i) through (viii)...

(vii) The noncompetition agreement shall be supported by a garden leave clause or other mutually-agreed upon consideration between the employer and the employee, provided that such consideration is specified in the noncompetition agreement. To constitute a garden leave clause within the meaning of this section, the agreement must (i) provide for the payment, consistent with the requirements for the payment of wages under section 148 of chapter 149 of the general laws, on a pro-rata basis during the entirety of the restricted period, of at least 50 percent of the employee's highest annualized base salary paid by the employer within the 2 years preceding the employee's termination; and (ii) except in the event of a breach by the employee, not permit an employer to unilaterally discontinue or otherwise fail or refuse to make the payments; provided, however, if the restricted period has been increased beyond 12 months as a result of the employee's breach of a fiduciary duty to the employer or the employee has unlawfully taken, physically or electronically, property belonging to the employer, the employer shall not be required to provide payments to the employee during the extension of the restricted period.

Enforceable versus written in a contract are two different things.

The question is what is the rate of voluntary compliance in what would otherwise be an illegal contract.

In Germany (and probably much of the EU) that incentive is built into the law, as it should be.

I think it’s boilerplate in big company contracts there, but extremely rarely enforced, because IIRC the amount you have to pay is the comp for the job you’re blocking.

When I had a contract like that, I occasionally fantasized about getting a FAANG job and being paid in full to not take it, but in reality that would never happen unless you got caught in a spat between rival executives.

In France a non-compete clause is only valid if it is bounded in time, geographically, for a specific type of job and with financial compensation while it is enforced (not necessarily full pay but has to be proportionate to the constraint).

As an engineer, I have seen a lot of contracts with bogus non-compete clauses and never seen one that would hold in court. So the employees are technically protected but still subject to psychological warfare (threats when you plan to ignore an illegal clause).

> non-competes are fine if they are narrowly focused, fair, and your compensation is sufficient to make it worth the restrictions

Yes! This is a particularly true for most software engineers. I have a friend who is a doctor whose contract says that if quits, he can't practice medicine within a 30-mile radius for 12 months. His only option would be to move to a different area, take a job with a horrible commute for a year or to wait it out. On the other hand, as a software engineer, I've never been in a situation where my thought is to move to a direct competitor. My skillset is broadly applicable to many industries, and it wouldn't be strange to do one gig for Home Depot, the next one at Google, followed by a role at Tesla.

A lot of doctor and vet contracts are like that because they are likely to get a large local client following just by joining a practise that the practise has spent years cultivating.

There's an easy way to solve this problem without non-competes: Treat your employees better. Usually by paying them more.

The entire concept of going to work for someone else is that it's supposed to save you a lot of trouble having to sell your services on your own/run your own business. If it has become so much more profitable for doctors to leave and start their own practice then they should be doing that because you're not paying them enough! You're not "making good" on your end of the bargain that we offer in civilized society.

Sure, and if a doctor is good enough, he can just start his own practice from the start and never have to sign anything since he never join any practice except his own.

That line of reasoning goes both way. If you sign something, then it was worth it for you.

>if a doctor is good enough, he can just start his own practice

It depends. Many instruments, such as PET in nuclear medicine, cost a lot. One have to work for hospitals/networks to help his/her patients with that instruments, no matter how good he/her is.

This perspective completely evades the actual argument which was that practices behave this way because they're extending access to their client base which is a resource they cultivated themselves and which will almost certainly yield a following the the new applicant.

A client base is not an exclusive resource that only the employer gets to have. If the doctor started a coffee shop and those same clients started going there for their coffee would it be the same? Or perhaps the whole point of such clauses is the very definition of anti-competitive behavior.

Also, if the doctor's patients all like him enough to switch to his private practice when he leaves then clearly they weren't paying the doctor enough. He was worth that many patients!

They could pay doc more if they didn't spend any money on marketing and retention but that would be a lose lose situation, especially as most docs bill money on a per visit basis.

Complete bullshit. The patients are not "theirs", they are not resources to be traded. The doctor is the one extending services to the practice. They're the ones who benefit from having high quality professionals attending to patients. The practice did not cultivate anything, the doctors practicing there did. Doctor-patient relationships are personal and it is 100% unethical to interfere in them with anticompetitive contracts.

> it's supposed to save you a lot of trouble having to sell your services on your own/run your own business

Can't stress this enough. Show up, attend to patients as scheduled then go home and enjoy life. All the boring details are taken care of. It's definitely more profitable to start one's own practice but the comfort of working at such places should not be underestimated.

Not always, a vet practise can have 1-5 million in fixed capital costs. Surgery, dental, x ray, blood and so on all add up. Sharing admin and vet techs helps too.

It's still an anticompetitive clause. The patients don't belong to the practice.

When my dentist retired his practice they actually sold the client list specifically, so I am not sure this is legally true. Morally I agree.

What exactly is this "client list" that they sold? Names and contact information?

Yeah, it's generally called good will. Client list, client interaction, services, and payments history, website, company name. The ability to figure out the best clients and continue the relationship with them.

I know a PT who signed on of those. Then left, worked outside the agreed radius (but still in the same metro area) , and was still sued. He eventually settled.

I imagine the lawyers came up with some bull like "well actually we meant that the 30-mile radius of your new clinic can't overlap with the 30-mile radius of ours"?

Luckily Google does not, to my knowledge, try to have non-competes in their contracts, and they would not be enforceable in California, otherwise the problem with companies their size would be that they "compete" in an awfully large number of business areas.

Going from Google to Tesla? Sorry, they're a competitor in driving cars. Spotify? They compete in streaming music. Microsoft? They compete in search. Apple? They compete in cellphones. Telegram Inc? Google does instant messaging. Garmin? Google does maps. NCR? Every heard of Google Wallet?

Serious question: is it even possible to get a well-paying dev position that doesn't have one or more of the clauses listed in the article?

Another consideration is whether the contract can be enforced and your legal recourse if the counter-party attempts to enforce an invalid contract clause. This is particularly true for noncompetes.

A better piece of advice than "never sign" is to simply find an employment lawyer and discuss the ramifications of the contract prior to signing.

I have successfully negotiated my way out of non-competes and other onerous employment contract terms. Only at small- or medium-sized startups, though, not big tech. In general the bigger the company, the less willing legal is to play ball. I suspect going for rather senior roles helps, too.

Non-competes are dog-eat-dog "fuck you" territory for me. I don't even bother negotiating. I happily sign non-competes, but will never sign a non-compete that's actually enforceable. If their lawyers want to lie to me about what's legal in my state, I'm happy to let them engage in unfair and deceptive behavior right up until there are actual damages.

More importantly, I would also happily fight them in court if it came to that (and retire on the triple damages).

I'm thinking of some of the other clauses:

1. "one-sided termination clause": Every contract in an at-will jurisdictions without a guaranteed exit bonus contains, implicitly or otherwise, a "one-sided termination clause". I have never seen a contract for "normal working stiffs" that contains an exit bonus, and I've only ever worked in at-will jurisdictions.

2. IP assignment

3. Confidentiality agreements with broad language

Very, very, bad idea. Never sign something you disagree with because you believe it to be unenforceable.

I disagree. My employment attorney recently reviewed a "non compete non solicitation" doc for an engagement and said, "it's copied from LegalZoom and is so badly written it will be unenforcible in the jurisdiction and here is why." They earned their $300 for reviewing my employment docs (for reasons beyond this specific issue). When in doubt, seek counsel and follow their guidance.

That's...rather different. You actually consulted an attorney. 99.9% of the people trying this one weird trick do not, often to their great cost.

How would you even function in the US? Just one time to get an apartment they had me sign an agreement stating I was not in the military, had never been in the military & would not join so long as I lived there. Keep in mind, I was subject to conscription at the time.

The whole thing is laughably unenforceable as well. They're trying to end run around federal law protecting members of the uniformed services. You can write any contract you want & have anyone you want sign it about. Doesn't mean anything, at all.

Also I'm pretty sure if I got called up to go to war, there is going to be someone in the DoD who can give me a little legal help in explaining to the landlord how hard they need to pound sand.

That’s a good example, but most contracts have language such as “if any clause of this contract is found to be invalid, the rest remains in force”.

So yea, in a case like that that part of the contract would be struck, but it isn’t a get out of jail free card for the entire contract.

You're talking about "severability" in US contract law. The rest of the contract was either stupid (regulating my usage of the non-existent golf course) or just garden variety stuff (can't sublet, etc.).

The same company also just dropped off an "updated" contract a few months later and told me that I had to review it and sign it or move out by the end of the month. I obviously just ignored this.

Right, but in an employment contract you want that severability. If the company tries to enforce the non compete clause and it’s invalid, you don’t want that to invalidate their obligations with respect to your pension.

My experience with companies pulling DIY contract addendums out of their ass is that they forget severability clauses. Or that the contract starts falling apart because they have other sections which refer to the severed part which means those sections also fall apart. For example, a damages section that ends up exceeding state law.

DIY contracts are the best to sign because they are such a mess.

I’m a lawyer and a few years ago negotiated a “we own everything you make” clause in an agreement for a batch of engineers who were being hired at the same time. We couldn’t get the clause changed - as others have said, BigLaw drafted it, the employer didn’t want to change it - but we did get an email after back and forth that said they had no intention of enforcing that clause for stuff you make outside of work. So I sent that email to the engineers and they can hold onto it in case there’s an issue in the future.

Reasonable companies don’t want to get a reputation for litigating employment clauses like this. Sure, there are outliers, but nobody wants to be on the front page of HN for suing an engineer over a side hustle. Especially not in this labor market!

Side note: it was delightful to me that the engineers carefully read the agreement and one of them consulted their own lawyer. Most people don’t do that.

Are you a lawyer? Or do you have a lawyer review every contract you sign? Just curious how you are so confident a particular contract, or clause within, is unenforceable. Not saying you're wrong, but how do you know?

> Are you a lawyer?

No, and my posts are not legal advice.

> Or do you have a lawyer review every contract you sign?

Yes, and they provide me with legal advice specific to my situation.

> Just curious how you are so confident a particular contract, or clause within, is unenforceable. Not saying you're wrong, but how do you know?

MA statute is very clearly written and its courts don't have a reputation for fucking around with legislative intent.

My (well known, big) company doesn't do non-competes. They do have the clause of not poaching employees for a year after you leave, though.

And I'm free to work on other stuff or have a side business. People in the company disagree on how much of that needs to be disclosed, though.

in some states those clauses aren't enforceable like in california.

I mean in principle, I agree with all of these points. But in reality if you stick to these rules hard and fast, you'll basically never accept a job offer. That's clearly an exaggeration, but many-to-most of these clauses are in every boilerplate contract.

Whether it's a small startup that's using a generic contract they've gotten from the internet or their lawyers, up to massive corporations, they're all going to include semblances of some of these points. Probably for different reasons, but the points will still be in there. Startups and small companies might be more flexible to work with you on changing parts, but still the legal headache of changing anything is often far greater for the company than just passing on you and looking for another candidate. Infinity moreso for big companies.

My experience is biased towards technical roles (like most on HN), but I've worked for startups, big companies, and as a freelance contractor. It's the same stuff in most contracts. Obviously my experience is not indicative of 100% of companies and I'm sure I'll have people chime in saying they had success getting company X to change some of their contract, but it's overwhelmingly not going to happen. So to treat these points as 'rules' instead of 'points to be aware of' is a bit too hardline of a stance to take in my opinion.

I've had a "we own everything you make" clause in contracts before, it's just copy pasted boilerplate, and they were fine with removing it when I asked.

Noncompetes I've been fine with, because they were always quite niche companies, and the wording was something along the lines of "don't join our direct competitors for a few years", and that seems ok to me. I will grant that it gets more complicated with megacorporations that work on everything though, as their "competitors" are roughly everyone.

I think the important thing is that you asked.

I've had a very negative experience, where I also asked, and they basically said "sign it or GTFO". So I did the latter, and I'm very glad I did.

A number of years back, our company was acquired and they sent us employment contracts from our new owners, with that same "sign it or GTFO" message. Many people signed. A few of us just didn't. Nastygrams kept on coming, we kept on ignoring them. Ultimately, we never did end up signing.

Which is the other piece of the puzzle - lawyers are really good at knowing when they actually have power and when they do not. Unfortunately, when they don't truly have legal power they resort to bullying. So if you are being bullied to sign a contract, that usually is a red flag to stop, really look at things, and figure out why they are using that tactic. You may be in a better situation than you think.

I think you might be a bit presumptuous. Why do you believe they don't have legal power? If you are an at-will employee, you can typically be fired for any reason. Not signing the updated employment agreement is, unfortunately, a valid reason.

In your case, they did not exercise that right. But I've been at places where they did. For something as petty as not signing an agreement which appeared to eliminate some employee benefits that were contractually obligated. Could the fired employees have sued, and won? Perhaps. But it would be an expensive, risky, time-consuming proposition to find out.

> many-to-most of these clauses are in every boilerplate contract

Contracts are entirely negotiable. If there's a job you want, but the contract contains an objectionable clause, tell them that you're willing to accept if they strike that clause. If you're at the point in the hiring process where they're showing you the contract, that means that they've sunk resources into you that they don't want to throw away. And the fact that these clauses are boilerplate, as you say, works in your favor, because nobody involved in the hiring process consciously chose to put that clause in and they probably don't really give a damn.

> because nobody involved in the hiring process consciously chose to put that clause in and they probably don't really give a damn.

Yes but I think I didn't convey my point enough. Nobody involved in the hiring process cares, and if it's a good company they probably agree with you. But this standard contract is what they paid attorneys good money to comb over with a fine tooth comb for liability, and eventually sign off on.

Very very very few companies are going to go pay Expensive Law Co. (TM) $500 per hour to review changes to the contract just because _one_ potential hire who still might not even accept the offer says they won't accept if that's in it. It's way out of most recruiters or engineering managers that you might be interfacing with to make that happen, not to mention making their life way harder. Heck even a startup CTO might balk at having to go spend more on legal.

I have had clauses similar to the "we own everything you do 24/day" one and I've pushed back on all of them. Every time, the response is "yes we totally understand but we have no power to change the wording in this contract we use for every single employee" and it just comes down to a gut judgement call on my part on if I feel they will actually screw me over on that point.

Again to emphasise, I totally agree logically with author's and your points. But it's simply not realistic to approach job hunting that black and white unless you're comfortable being out of work for months until you find the perfectly-flexible-enough company.

Nobody is going over a contract with legsl just because they removed the ‘we own everything you make’ clause. That’s an irrelevant part of the contract.

My experience in the USA is that they will flatly refuse to change anything in the contract, and will tell you to take it as-is or walk away, in part because they feel like they can't make changes without getting it re-approved by legal first.

I've had the opposite experience. There was always a bit of hand-wringing about "oh, but this is the contract approved by our legal consultants...", but pointing out the fact that A) this clause is flatly impossible to enforce in my jurisdiction and B) it would be immensely silly to blow up this entire hiring process over a contract clause that, best case scenario, would involve them having to sue me and lose to enforce has always made the hiring manager sign off on the reasonable modifications.

Of course, if the clauses are enforceable in your state, it might be a different matter, but that's also an opportunity to make demands. "Sure we agreed to $XXX,XXX , but there was no mention of a noncompete. That's going to need $XXX,XXX+$YY,YYY or $Z weeks of vacation". Make the numbers bigger than you think is reasonable, and they'll probably cave on the contract clause. Or they'll compensate you for it. Win/Win.

At big companies they will not change the contract for a single candidate. No way. Not unless it's a "big deal" sort of job where the executives are involved. They'll just tell you to go pound sand.

The correct course of action is to cross out the clause, put your initials next to it, then sign the document. It is the responsibility of the company to have someone review contracts for such things but they never do; they just collect all the documents, check they're signed, and file them away to be forgotten about forever (or until a lawsuit requires they be retrieved).

I've done this at several employers! I even tell the HR people what I'm doing so they can't claim they're being misled. Not once have they ever understood what I was even talking about or even cared. It's because they're HR people; not lawyers. They just "follow the script" as it were.

One woman at HR said that what I did--crossing out the "we own everything you make while you work here plus a year afterwards" clause--was a "very good idea" and just took my documents and filed them away like anyone else's. I even offered alternative language that would be fair along the lines of, "we own everything you make using company resources in your official line of work" but she wasn't interested.

A lot of HN folks make stuff and these invention clauses are completely ridiculous. If you invent a new kind of apple peeler in your garage on a weekend using your own tools it is absolutely unconscionable that your employer who pays you to do programming or management work could claim ownership of that thing. Even if the contract says as such I seriously doubt any court would enforce that unless you worked at a manufacturer of apple peelers.

This. You always have the power to change the proposed contract to suit your needs, and let them balk if they don't like it. This assumes it's a contract you can actually edit (whether on the computer or mark up with pen); for non-editable things (e.g. DocuSign contracts), I'm not sure what you'd do if you can't print it out pre-signing.

For the latter, I've sent them a "diff" over email containing the changes I required before signing. They didn't accept any changes to the document itself, but they did let me create a separate document with clarifying language.

They’ll tell you that this is unchangeable, it’s the default, etc the first few times, but if you persist, they’ll usually just strike out a clause like this if they actually want to come to an agreement. They may not even bother telling legal (depends on company size).

Really it depends whether you’re negotiating from a position of strength and and can walk away, if you are changes like this become possible, if you are not changes are more difficult.

I've never had any HR person give up even a comma in a contract like this, even after a full week of back-and-forth negotiating and trying to get them to strike out an individual sentence or change a word. Their attitude is that even if they lose their first choice hire over it, they always have a pipeline, and they'd rather adhere strictly to legal protocol and go with their second-choice hire.

Don't talk to HR, talk to the hiring manager.

They've always just kicked it over to HR. In hindsight I probably could have leaned on them harder.

I think you are exaggerating.

> Very very very few companies are going to go pay Expensive Law Co. (TM) $500 per hour to review changes to the contrac

If they are already hiring "Expensive Law Co." then most likely they have them contracted anyway. Even with big corporations, there was never an issue with this. They were always happy to send my changes to their legal team for review and also allowed me as much time as I needed to review and consult my own legal team (if I had one). It is in their and my interest that the contract describes the relationship in a way we both want and it is fair for both sides.

> "yes we totally understand but we have no power to change the wording in this contract we use for every single employee"

Had that too. Just be persistent and firm. "I can't sign the contract with these clauses in." 100% of the time they would eventually change their mind. It may be bad for them that the clauses will be gone, and they need to show their employer they put up a fight and also it would be much worse to lose resource that otherwise was ticking all the boxes.

The issue is in smaller companies that don't have standing contracts with Expensive Law Co, and can't afford to even pick up the phone to ask them a question unless they're in serious need.

In 20 years, I've never seen a company that was willing to negotiate over the employment contract of an employee. As a freelance consultant, I had free range to negotiate, but as an employee, the contract was always presented as "take it or leave."

That's probably because most people don't even think about it or bother trying. They may not even read the agreement!

I've successfully negotiated contracts several times in the past. Even once at a big company (that I knew was desperate :). As long as what you're asking for is reasonable they'll usually make the change unless it's a really big company. In that case they're not going to bother and just tell you to either sign it or go to work somewhere else. They know they have plenty of leverage and there's always someone else they can hire.

I've negotiated literally every employment contract I've ever signed. Hiring people is expensive, and by the time you've found someone you're willing to extend an offer to, there's a lot of sunk cost. That, my friend, is called "leverage".

I've done it a couple of times. Recently I started a new job where they had a "we own all of your IP you create at any time" clause, which is ridiculous. They agreed to change it to only include IP related to their normal business which I think is fairly reasonable.

They don't give a damn, but every time I've asked for changes to contracts, including positions I was actively recruited for by the hiring manager, once even by the owner of the company, I'm told to sign it or no job. In the case of the owner asking me to apply, they literally said "My lawyer says to leave it in, you're not a lawyer, it's staying in."

I'm sure some people have negotiated these things but I've tried multiple times - to shorten noncompete lengths, to remove the "anything you do on our machine is ours for all time" stuff, etc - but never had any success.

"My lawyer says to leave it in, you're not a lawyer, it's staying in."

The response there is "Well you aren't a lawyer either, and mine said it needs to go".

As others here have said, crazy clauses can go. One key point, make it clear it is about unduly restricting right to income in the future, without wanting to screw over anyone.

This is why a second response, such as "Well, if you triple the salary ... maybe" makes a point here.

Some contracts literally make it impossible for you to work in the future, in your field. That means 'gimme retirement salary on exit' minimum.

(Such broad clauses are rarely enforceable, you can't prevent a person from working at all, but... )

Can you clarify if you walked away (and they let you) or not? Because if not, then it was just negotiating 101.

They will 100% let you walk over this. And then what? Your next offer will be the same, and so on. Market forces don't work if every agent on one side of the market does exactly the same thing.

> But in reality if you stick to these rules hard and fast, you'll basically never accept a job offer. That's clearly an exaggeration, but many-to-most of these clauses are in every boilerplate contract.

In the tech industry, yeah, but there are industries that aren't so employee hostile where you can find better contract terms. I'd have to say in my experience, the tech industry is one of the worst when it comes to the malicious application of employment contracts. Apple is especially egregious with forcing interviewees to sign expansive NDAs; the Dilbert cartoon is spot on by making them dress like Apple store employees.

Totally correct - I tried to caveat that in my post by saying I'm skewed hard tech industry. That was the main attention of the article, and my main experience, so I was writing from that viewpoint.

I somehow doubt that Vail Resorts has a non-compete for their lift operators to go work on another mountain (although now that I think about it VR is pretty terrible so this might have been a bad example)

Maybe not Vail Resorts, but it is indeed happening...

The noncompete agreement prohibited Mr. Meier from hiring any of Intermountain’s employees, from janitorial staff to ski lift operators

https://ag.ny.gov/press-release/2022/attorney-general-james-...

Also, fast-food employees: https://news.ycombinator.com/item?id=28702468

The funny NDA's are the ones where they think they have a 'secret sauce'. Then you get in there and find out they are using some off the shelf API's exactly as intended. You start asking exact questions and they do not understand how you know so much about their product already.

How is it that someone smart enough to be able to read the docs and connect up to the API can still be unable to realise that they are using something that others can also use?

I just think it is sort of funny. But connecting API's up is what many do. Reading the docs is something a lot of people skip, not hard just tedious. The NDA part is a funny twist where I can see an NDA around their business case and who they are working with. But the tech is rarely anything groundbreaking. Had one guy who only wanted to work with 'mozarts' no 'salieris'. That was some weapons grade hubris there. It was basically a in memory hash table he was building. Thought he had some sort of serious secret sauce with that 'idea'. When his real secret sauce was his client list and connections.

We need a SAG style union to address issues like this, but that's pie in the sky dreaming.

Also verify that anything you're signing when you leave matches what you signed when you were hired.

I recently left a company where, when I was hired, I had agreed in "Appendix C" not to recruit any of their employees away from them for a period of 12 months after separation. When I actually separated after more than two years, the "Appendix C" they wanted me to sign and presented as the one I had agreed to at hire now said 24 months. I told them I was happy to stand by my original agreement of 12 months, but I had no incentive to extend to 24 and would not be doing so. They sent me one with the right number and I signed.

Their story was that, in the two years since I'd signed, they changed Appendix C and had "accidentally" given me the one that pertained to people who had been hired after me under the revised terms. I'm willing to give them the benefit of the doubt, because why believe people are malicious when they could just as well be careless?

> because why believe people are malicious when they could just as well be careless?

When your job is to be careful, being careless is nothing but malicious.

I'd tend to agree, but then again, there's so many people who are just bad at their job. Attention to detail is a skill which many do not care to sharpen.

Everyone's job is to be careful.

I'm sure the person who actually sent me the form was some low-level functionary. All I did was say the equivalent of, "Hey, this isn't the right form," and he went back to his supervisors and got the right one.

I sincerely don't think there was malice involved, certainly not at his level, so I just treated it like that.

I can believe that they're careless and used the wrong copy of a document but I'm not sure I understand why you're signing an agreement like that on exit: you've signed it on hiring so that regardless of the outcome of your employment, you're bound to the anti-poach. The only reason I can think that they'd ask you to sign the agreement again on exit is that they wanted to bind you into something new -- what explanation did they give?

I guess it's a reminder, so you can't claim you forgot about it.

Some wrinkle of "the law" probably works that way?

> I guess it's a reminder

I would happily sign a 1 page document that said, "I acknowledge that I have been reminded of my obligations under the document signed April 1, 2004 and been provided with paper copies of said agreement."

I probably wouldn't be happy, because what? Are we children?

Part of the issue is that lawyers get too free of a hand sometimes. We signed, agreed, that part is over.

Frankly I have never attended an "exit interview", and never will.

That said, if someone want a reminder sign, as you say, I'd expect the corp to sign one too, and give me a copy, as well.

When signing contract between two entities, neither side is special.

Often a company will offer severance more generous than they are contractually/legally obliged to in exchange for the leaver signing some extra restrictions beyond what was in the original employment contract.

> The only reason I can think that they'd ask you to sign the agreement again on exit is that they wanted to bind you into something new

In the Clerky boilerplate employment docs, used by many YC companies, the employment agreement contains a Termination Certificate along with a clause that says something like “upon leaving the company you agree to sign the Termination Certificate in the appendix”.

So technically, in the case of Clerky’s boilerplate docs, you agree to sign the termination form before employment even begins.

FWIW the termination certificate I’m thinking of is a very simple 1 page agreement basically just acknowledging to the company that you have returned all company IP, hardware, etc to the company and agree to continue to abide by the original employment agreement. It doesn’t really add any additional obligations.

I suppose the benefit to the company is just a reconfirmation that you are aware of the terms of the original agreement and that you’ve followed through with basic duties such as returning confidential data, hardware, etc to the company.

That said, many employers have additional severance agreements that can add lots of additional expectations such as non-disparagement clauses, but that’s typically only done in exchange for additional severance the the company isn’t legally obligated to provide you (in which case you can absolutely say you won’t sign the agreement if you want to forgo the severance payment)

Yeah, this was the situation, that I had agreed when I was hired to sign the agreement when I left. The issue was just that the summary of what I "had agreed to" when I was hired that was presented in the termination agreement wasn't actually what I had agreed to when I was hired.

I was leaving of my own accord, so no severance involved, which was why I told them I was happy to stand by the terms I'd already agreed to, including signing the termination agreement, but I wouldn't be signing a document that contained new terms.

Why would you need to sign anything when you leave?

Things like "we have all the debts settled and are good to part ways" are OK IMO.

I agreed to when I was hired. It was a basic summary doc: I've returned everything that isn't mine. I haven't kept records of things I'm not allowed to keep. I'm not going to poach your customers or employees (for 12 months, which was the part they tried to change to 24).

It works both ways. Maybe you cross a term you don't like in the employment contract before returning it to them signed and they never notice...

It happens.

Easiest way to do this is to not sign anything unless it involves extra pay. I’ve politely refused HR’s request to re-sign bunch of documents before when leaving - I didn’t feel like digging through them or paying a lawyer and they had zero leverage

I've never refused, but I do always outline the (usually low four figure) cost in time and legal expenses required to review the contract. I close by explaining that I cannot in good faith enter into an ostensibly binding contract without some form of consideration from my counter-party because such a contract would be difficult to enforce in any case.

HR never knows what to do and usually just never gets around to replying to the email.

I don't even politely reply. At my last job, HR sent me a "contract" offering $1 in exchange for agreeing not to work in the industry for 1 year. I archived their email and never spoke to them again :)

It would really depend on the job, of course. I didn't really care about that one, and didn't see myself ever wanting to work with that founder again, so I didn't make any effort to be "nice" in any way. If I ever left my current job, I would make sure to stay on the best of terms. I would be annoyed if they paid me $1 to not work for a year, but I also know they would never ask for that.

I had signed a contract at hire saying I would sign the separation agreement when I left.

I didn't have any issue with the agreement I had already made. I just wasn't willing to change it as I was voluntarily leaving and they weren't offering me anything to change the terms.

I'm not even 100% sure I would have noticed it except that my new employer required disclosure of any restrictions I had, so I disclosed the 12-month non-recruit from the previous company. It was fresh to mind.

The two companies are in the same general industry, but do not compete with each other.

> why believe people are malicious when they could just as well be careless?

For those who like named things: https://en.wikipedia.org/wiki/Hanlon%27s_razor

Since when do you sign anything when you leave a job?

Weird.

Yeah...when I left a job in 2021, HR presented me with a bunch of new agreements that they wanted me to sign. I explained to them that it just didn't work that way.

With enough compensation it could work. I'd sign "we'll give you $5M to not work for 1 year." Stream casual games on Twitch for a year :)

Sure. But they were just "Hey, sign these new agreements before you leave." Yeah...no.

> I'm willing to give them the benefit of the doubt, because why believe people are malicious when they could just as well be careless?

Funny how their "carelessness" always seems to benefit them at our expense.

> Also verify that anything you're signing when you leave matches what you signed when you were hired.b

Better, just don't sign anything when leaving without sufficient new consideration. If they really want to five you a reminder of what you signed when you joined, that’s what copiers are for.

> Anything you do with the company property, e.g., work computer, automatically belongs to the company, even if you do it on the weekends.

That doesn't sound unacceptable to me. It's not that I'm that strict about e.g. reading personal emails etc. on my work computer, but if it's some side hustle, be it for money or for fun, I think it's honest to take your personal machine for that.

Computers are just office equipment, just like pens.

If I gave you a pen and you wrote some story with it, then could I claim the rights to that story? I think not.

That's why they write it in contracts explicitly I guess?

Not everything in contracts is legally binding.

If I write code using some company computer, then the most they could do is charge me for the damages, i.e. the power used or in the worst case I would have to replace the computer.

Yeah, I'm not competent there. My impression is it should be enforceable, at least in the U.S., but I'd contact a lawyer if I wanted to know for sure.

If you make that pen available to me under these conditions? Sure.

If you "just give" me something without any conditions then no, you could definitely not claim that story. But if you make that pen, your property, available to me explicitly only for work and nothing else?

It's your property, not mine. I only have whatever rights you grant me to it.

Only if you sign the contract!

You don’t get the pen without signing the contract.

You can’t sign the contract without the pen.

Let's make this example a little more extreme to show how nonsensical a company claim is on stuff they did not create (or pay for).

If I used the company computer to access a dating-website, then could the company claim ownership of my firstborn child, if that was in the contract?

> If I used the company computer to access a dating-website, then could the company claim ownership of my firstborn child

No, but first kiss is definitely on the table.

> If you make that pen available to me under these conditions? Sure.

Let's leave aside whether the law (in whatever country) permits such a one-sided contract, and ask - should it permit it? There are plenty of contract terms that are illegal (i.e. not backed by law), such as usury [1] or various anti-competitive practices, because their enforcement is seen as either unfair, or a detriment to society, regardless of whether they were entered freely. Contracts are not and should not be above the law.

[1] https://en.wikipedia.org/wiki/Usury#Usury_law

> because their enforcement is seen as either unfair, or a detriment to society

I mean, I do agree with you in general, its just that I do not see this issue as a detriment to society. If someone demands massive interest rates on loans that you need to survive thats definitely unethical.

A company demanding that you do not use their laptop so that you can work on your side projects at home ... well, that doesn't quite sound as bad. There is nothing stopping you from just buying your own device.

Thats like saying "only use the company car for work stuff" ... it just doesn't seem that unfair or unethical to me to be honest.

Exactly this, and they are ubiquitous. With software I think it might be a slightly different matter as the company mighy have access to software you couldn't otherwise afford. But it's a red flag anyways ... why would you ever want to work for someone who'd want to claim ownership to something that is clearly not theirs?

Strangely it works this way though. It doesn’t make sense. In my current job I refused company equipment, and insisted on using my own. I pay for my own software too.

Safer that way.

If you explicitly included a contract that stated how the pen was to be used and the ramifications before my acceptance of your pen then yes.

Companies do include policies about how their equipment is to be used and for what and they do include how they think about ownership usually in your employment agreement or principles of employment policies. To write those off because “hey it’s only a generic piece of equipment” is perilous.

I suspect how you think about the analogy changes if you write the story on company letterhead or if you used the company car for your catering side hustle on the weekends.

This is usually a tax thing.

We have a policy that states, "company equipment can not be used for personal use". As without this company equipment can not be tax deductible. However, in the UK at least, it is a matter of economic policy whether a company makes any effort to in-force.

Thus I hit on what a I thought was a neat solution. Which was to deem it a sackable offence to expend any resource whatsoever including time or materials to identify if company property had been so used.

It's not that simple. The law recognizes that when signing a contract there is a power-imbalance between employer and employee. It would be different if the contract was written by the employee and signed by the employer.

That last paragraph of yours is key the your whole post. It’s a good illustration of how a large enough difference in degree becomes a difference in kind.

If you use the company car for a side hustle in catering, then that perhaps gives the company the right to fire you or charge you for damages. However, they do not get to claim any intellectual property (recipes you invented for your catering side-job).

I agree with that. In the pen example, they should bill you for the wear and tear on the pen (ball bearings and ink aren't free). In the computer example, same deal. Figure out what a flash memory erase cycle is worth, figure out what bringing the CPU out of its lowest power state costs per minute, figure out how many of each were used, and send an invoice!

I don't know whether you could or couldn't. But if I entered into such a contract, I'd obviously use a different pen, it's not that hard.

Is anyone really running their side businesses from their work laptops? That seems crazy to me.

I disagree. A vanilla MacBook might be a bit like a pen, but if that MacBook is loaded with a bunch of proprietary or licensed software, I can see why an organization wouldn’t want it being used for financial gain outside of the organization. Perhaps they don’t explicitly “lose” anything, but it’s their investment to have returns on.

If a laptop is like a pen, what about a high end graphics workstation? What about a small server? Internet bandwidth is a cheap commodity, can I run my site from work? Electricity is basically free (I charge my personal scooter at work), what about a small Bitcoin miner?

So you're the one who keeps taking the company's pens ...

More seriously though, there are frequently restictions of the use of office equipment (or business equipment in general). Businesses will often overlook it if it is not a problem, say if you need a photocopy of a rental contract. They have the discretion to say no if the privilege is being abused, say if you started printing hundreds of pages a month for personal use. The misuse of pens is rarely seen as an issue since they hold little intrinsic value and are routinely replaced.

Should they be able to claim the rights to something you produced with their equipment? In most cases, no. I'm not going to say in all cases no since there is always going to be someone who pushes the limits beyond reason. (Say a person develops a piece of software with a company computer to sell on the side. Can that be construed as the business indirectly financing the development of the software by providing hardware and/or software tools?)

In general, it is always a good idea to do personal stuff with personal equipment and business stuff with equipment supplied by the business. I'm sure the coworkers who are searching for the missing pens will thank you for doing so.

I think it's fine to require that you cannot use work equipment for personal projects, but claiming ownership of a project written on the weekend on a company laptop isn't the solution.

So now I have to lug around two of everything (laptop, phone etc) just because I might want to do something unrelated to work?

It is completely unreasonable as a blanket statement.

Three.

My employer's laptop, my current client's laptop (I'm in a consulting branch of a large corporation), and my personal laptop. Pre-Covid I lugged them on airplanes every week.

I enjoy HN for many reasons, one of which is to encounter approaches and perspectives that I would not ever even remotely consider. I would not use my employer's laptop for personal, let alone a side-gig purpose, with a 10 foot pole. It's not mine, I have no control of it, I have no visibility into what is being monitored nor how it is used, where the data goes, what I should install on it, etc. Employer has full legal right to request it back this evening, do whatever forensic examinations they want, and have interesting questions or claims on anything they find.

Yes laptop is a tool, but it's such a complex multipurpose massively powerful dangerous tool, that even if we try to make a claim "Pen and Laptop are legally the same as a employer-provided-tool", I find the surface area of a Pen minuscule compared to the surface area of a laptop and everything I can do with it / put on it.

Big +1 on that. I assume a model where my work laptop screen is being directly mirrored into a room with 100 people watching it 24x7, basically. Entirely impossible, but every organization has some level of monitoring between zero and my theoretical scenario, so I carry a personal device and completely sidestep the entire issue.

And I've setup everything from scratch. There is no software on there that I wouldn't install on my personal machine. If anyone wanted access to it they'd have to ask me for a password noone else knows.

Yes, it is perfectly reasonable and in many cases prudent to not use your companies laptop for home-use. So you may chose not to do it.

That the company would own everything you did on it is still completely unreasonable.

Not to negate your point, but a related pondering : I would assume that the Venn diagram of companies that make claim on property created on their laptops ; vs companies that let you install fresh OS and software from image and repository of your choice and access work network / store proprietary data ; is practically zero.

(If you did not install fresh OS from image of your choice, then you did not install software from scratch and should not be confident what's in your work laptop and what it's doing / monitoring)

Yes.

It's not your equipment, you didn't buy it, you can't just do whatever you want with it. It's like being given a company car but going on a 3,000-mile roadtrip "because why should I have my own car if you gave me this one?"

It's not remotely unreasonable to expect someone not to use their employer's equipment to make money on the side, especially for something like a laptop which over the course of what a developer earns in 4-5 years is basically nothing.

> It is completely unreasonable as a blanket statement.

I personally find your position unreasonable: that you should be entitled to use property that is not yours how you see fit, because it’s more convenient to you.

In reality, any sane organization wouldn’t punish you for reading the news on your work computer, but to assert you should be given access seems unreasonable to me. You’re paid to do a job and they provide some tools for you to use to complete that job.

Why not just buy a laptop and ask your employer to pay its depreciation? It's way easier for both parties I think.

Really you should use a dumb terminal and keep corporate and personal materials on separate machines.

If your company ever ends up in legal hot water, you’ll be glad you kept a physical separation between your personal affairs and work equipment. See for example the Enron emails, which were made public as part of discovery and include thousands of personal emails from people who used their work email as personal email.

Another wrinkle on "company property" you have to watch out for:

When I was in grad school, a professor in my department left to take a job at another university.

The beancounters demanded the return of the department-issued computer he'd had...in 1985.

Of course, that was many, many computers ago, and what almost certainly happened was that he'd transferred the machine to a grad student or whatever when he got a new one, and they'd just lost the record of the transfer (or never entered it in the first place). Still, he had to go through a week or so of back and forth before they were convinced that a) it was unreasonable to expect him to account for a computer from decades ago and b) even if he did still have the 1985 computer, it wouldn't be worth anything like their book value any more. They actually wanted to charge him the original 1985 price for the "missing" computer!

I guess the moral there is to keep your own careful log of what happens to any company property that's been issued to you.

When I worked in tech support at my University, we 100% knew we were never getting it back but had to ask like once a year anyway because government. Public money means excessive tracing for any asset!!

OP refers to a post from Joel Spolsky, but there is a better one that he wrote that I'll include the text below.

It was one of those posts that stuck in my head because it makes sense. There may be an overriding reason why an employer is likely to tell you to take the contract as-is or walk, no matter how much they want you to join. You may think that you are super-valuable engineer, and maybe even the hiring manager, but not if your negotiation is likely to hold up the due diligence of the investors' exit.

https://www.joelonsoftware.com/2016/12/09/developers-side-pr...

Even if a company decided, “oh gosh, we don’t want to own the 5:00-9:00 inventions,” they would soon get into trouble. Why? Because they might try to take an investment, and the investor would say, “prove to me that you’re not going to get sued by some disgruntled ex-employee who claims to have invented the things that you’re selling.” The company wants to be able to pull out a list of all current and past employees, and show a contract from every single one of them assigning inventions to the company. This is expected as a part of due diligence in every single high tech financing, merger, and acquisition, so a software company that isn’t careful about getting these assignments is going to have trouble getting financed, or merging, or being acquired, and that ONE GUY from 1998 who didn’t sign the agreement is going to be a real jerk about signing it now, because he knows that he’s personally holding up a $350,000,000 acquisition and he can demand a lot of money to sign.

The above is an IP example, but non-competes may be the same (regardless of if they are enforceable). Q:"What is to stop everybody resigning after we announce the merger and working for the senior manager the next day?" A:"Every employee has signed one of <<these>> and most will be scared of the threatening lawyers letters that we send."

How are noncompetes the same when they are illegal in CA

They are probably not illegal to put into a contract, even if they are illegal to enforce. I don't know about CA specifically, but we have similar statutory rights UK, which is why employees largely ignore them by signing the contract with the non-compete clause in.

The point still remains. There is sufficient contractual legalese that is backed up by threatening lawyers letters that stop some or most of the staff leaving and going elsewhere. That is enough for the deal to go through.

It is illegal to put a non compete into an employment contract in CA, to the point that doing so can nullify the entire contract and rescind any IP rights assignment

I assume that I understand your point and probably even agree with the sentiment, however the content itself appears to be saying, "Don't sign contracts", or, "Don't work for other people." Granted, that's from a mostly USA-based perspective.

I've agreed to some terms because I didn't actually care whether they were enforced, because I was pretty confident the company couldn't or at least wouldn't do anything about it, or because my life circumstances didn't supply the luxury of choice.

Understanding the potential consequences and "why those may be bad" is useful, and prodding companies/governments to move away from that stuff is awesome, but "don't do that" isn't necessarily an option in many (most) contexts.

The only time I've been burned by my contract is from relocation expenses. I went to a company to take a job and not long into it a reorg moved me to a different team. I left the company and they demanded I pay back my relocation expenses. When I protested that they changed my role to something not what I was expecting, I was told that according to my contract it doesn't matter. The temporary housing I was put in was very expensive despite the fact I hated it. Luckily, my balance was paid as part of a signing bonus by my new company.

My lesson here was: Never take a relocation package that has the company sorting your housing and travel, just ask for a large signing bonus instead.

Even signing bonuses sometimes have to be repaid if you leave the company too quickly.

For sure. I sort of get the company not wanting spend money to sign me and then I immediately quit.

The relocation management company racked up a bill I would have never incurred if I allocated the money myself.

I got paid relocation once, and the contract said that if any employment changes were on their end, I wouldn't have to pay the costs back. (I think this is why there are clauses like "if we don't hear from you for 3 days, that counts as resigning" instead of "if we don't hear from you for 3 days, you're fired". BTW, never go on vacation in a no-cell-phone area over the transition date for a vacation tracking system migration. Learned that one the hard way!)

Nobody should sign a contract where they can fire you and charge you relocation costs; that is not employment but a scam to prop up relocation companies!

If you quit, then it's 50/50 in my mind. My take is that I don't want to be liable anything for quitting; the signing bonus is literally a bonus for signing the contract, not an obligation to do a certain amount of work. Salary covers the work. But I'd probably take a signing bonus that requires some tenure to not have to pay it back. Spend the money after that period. (Relocation is different to me because the disruption in your life is what they're paying for. If you don't like the job, your life was still disrupted. You're not asking for them to unrelocate you.)

A big one is missing in this article: The clawback provision.

In 2011, when Microsoft bought Skype for $8.5 billion (that’s a B), some former employees and executives were outraged when they found that their equity was worth $0 because of a clawback in their equity documents.

“The only mention that the company had the right to buy if he left in less than five years came in a single sentence toward the end of the document that referred him to yet another document, which he never bothered to read.”

https://stockoptioncounsel.com/blog/standards-ownership-cant...

https://www.forbes.com/sites/dianahembree/2018/01/10/startup...

The author ignores an important part of the negotiation equation - are you being adequately compensated for the imposed limitations?

For example a one year non-compete after separation might be unreasonable by itself, but coupled with one year of full severance pay is a different story, although there is still the "what am I supposed to do with my time?" issue.

If you are a founder/early employee with significant equity then a non-compete clause when being acquired will likely be acceptable to you.

> Another clause to watch out for […] is the "I agree not to cause any other employees to get hired," which prohibits you from hiring directly or allowing any current employees to get hired by the company to which you went. This clause protects the company from the unlikely event of a manager leaving and taking their team with them.

I had a previous employer threaten to sue me for this after a couple friends followed me to a new job on their own accord and despite having signed nothing of the sort. One strongly worded letter from a lawyer though and they dropped the whole affair.

I wonder how these hold up, and what the clause “I agree not to cause any other employees to get hired” means in a legal sense. Like, if you and I work at Company A, and you go to Company B and I want to go there because it’s amazing. If you recommend me, is that causal? I have to interview and all that still.

If you leave for a managerial role, can you hire me if I make first contact with your new company? That seems causal, but also easily circumvented.

I mean, real talk: every time I ever objected to something like that, they always said something like: "oh, we don't care what you do in your off time. You can always e.g. ask for an exemption for specific open source work later", and "its very unusual for us to change this, we've never had anyone ask for this kind of thing in the past".

If I had followed this advice, I would have missed out on one of the best jobs I ever had. So, just YMMV.

"Well in that case, it shouldn't be a big deal to just strike that clause, right? Here, we'll even scribble in a little line here confirming that the company does, in fact, own the rights to the software I write FOR you, as part of our employment relationship".

Hey everyone, author here :) I'm sure most of you have more experience with contracts, so I'd like to hear your thoughts on stuff we, developers, shouldn't sign.

Cheers, Vadim

Very useful article. Thank you for putting it together. On one hand, you should read an employment contract or options agreement down to the letter, as you highlight. However, in my experience, most contracts have these provisions, at least in the US. Also, companies are going to be reluctant to deviate from a form template as this creates a legal mess down the road. My point being, you'll find it hard to "never sign" if every employer does this.

strike out and initial?

Sure - reducing items might work. But asking a company to give you tag along drag along rights when they weren't there just wont float.

Hi Vadim, it’s so great you’ve written this and are trying to help others! It might be worth pointing out that in some places (Australia, I think California? And probably the European Union) the non-compete clauses can’t be enforced because companies aren’t allowed to stop you from making a living. Anti-poaching of employees sure but not anti-compete. So maybe people could do a quick google for their country or state to see if it’s even something to worry about (so they don’t reject a job for something that in practice isn’t relevant). Also, I’ve noticed that the NDA components are usually very reasonable as they mostly cover “material non-public information” (or something like that) so usually it’s not an issue, but good to check for sure.

Good advice. Same with Canada.

You missed the non-disparagement clause.

This is silly. It would be useful if it said something like “here are clauses that you should understand the implications of very clearly” but that’s about it.

Work for hire clauses are totally normal for certain kinds of work and no sane company is going to want you contributing some relatively inconsequential portion of a creative project unless the contract makes it clear you won’t claim to own it all later.

Same goes for the idea of never signing an exclusive distribution agreement. You would tell someone not to have their book published by a major publisher?

The rest mostly have nuance too. The various forms of non compete and NDA agreements are clearly unethical for entry level workers and would be essential for any high level CEO gig, or principals in a corporate acquisition

Also big companies are conservative, and they don’t care about your demands. If you don’t have a track record and want to do business with big companies you might have to sign some crazy stuff. Your other option is to not get enterprise business, and for the most part it doesn’t really matter it’s fine to sign some stuff and get paid.

The answer to this stuff is it depends.

Ancillary, but I'll add to be careful with contracts around purchasing large building items, specifically in my case referring to SteelMaster buildings.

They will sell you on something saying they will deliver it and a truck is coming through your area soon, etc., then the sales guy will call at dinner time and say oh by they way your delivery is ready to ship out we just need you to sign something real quick and you're good to go. Then after you sign they will point to a clause in the contract that says they are not actually responsible for delivery and they won't deliver and you have to actually come pick it up. It's essentially a scam, and I'm unsure how they stay in business that way (I suppose people who work with them just know that's the deal and go into it knowing that), but it's one of those things that is a hard lesson to learn for having quickly signed something without fully reading it.

Lots of complaints here:

https://www.bbb.org/us/va/virginia-beach/profile/modular-bui...

Didn’t see the particular one you mentioned. It is amazing companies like this can get away with so much crap.

Grabby abusive employers will likely hate this and downvote...But, while I don't have any experience with separate NDAs, never given nor received (they've always been baked into contracts and never presented a problem, were always scoped and not grabby), yet back in the day I turned down over USD 250K in multiple contracts that had funky "grabby vague IP provisions", or "grabby excessive non-compete provisions" when I was contracting and the contracts related to side-projects. Probably doesn't sound like much, but it was a lot for global remote at the time.

Well, it all worked out well. The personal projects I was working on and protecting paid beyond that now...!! Hahah.

That's why I prefer business to business type of contract rather than employment. Unfortunately in many countries government are bribed by big consultancies to limit or even prevent individuals from running their own consulting business.

Is it worth drawing up a standard rider for employment agreements? Stuff like “I own stuff that I create on my own time and with my own equipment” would be in there along with voiding non-compete clauses. Also, adding protections to minimum time off per year in the face of companies doing the “unlimited PTO” trick.

Then it becomes an exchange of paper rather than sitting there with a highlighter handing it back and forth between, you, the recruiter, HR, and legal. I sign your contract, you sign my rider with everything I care about.

Something I didn't see in there that's a good thing to look for, or a good thing to ask for, is "quitting for good cause" - it's basically the inverse of "firing for cause".

A couple jobs ago, my signing bonus and equity were revocable (so I'd have to return the bonus) if I was fired for cause. Somewhere in the contract they'd also used the term "[quit] for good cause", which introduced me to it. I came back and ask for the term to be applied to many more places - if I fired them as an employer for cause, I'd explicitly keep the signing bonus, and accelerate my vesting.

It ofc never came up; they were great to work for, even if in the end it didn't work out. They very much took great care of us when the endeavor was shuttered and we were all let go; so to the top comment's point, the vibe of the contract matched the vibe of the gig.

Edit: It's apparently a nationally recognized term, but depends on state law to define:

https://www.nelp.org/publication/good-cause-quits/

https://edd.ca.gov/en/uibdg/Voluntary_Quit_VQ_5/

I work in an industry that is very much “at-will.”

I signed an “Employee Handbook Acknowledgement” which says “I understand and agree that the handbook is not a contract of employment, or a promise or guarantee of continued employment”

The “handbook” contains statements like “company owns all employee creations and IP ,etc etc etc”

It’s ambiguous enough to seem to apply to side projects.

What is your opinion of this? Sounds like they want their cake and to eat it, I can’t see how this is legally enforceable.

Sounds that way to me too. Do you have an actual written contract of employment which the handbook attemps to tack clauses onto?

No. The only document I have signed is the aforementioned "Handbook Acknowledgement."

My concern is that there's a nefarious double-standard here in which they can say explicitly "this is not a contract" but if it were to go to court then legally it could be considered a de-facto contract since it has a signature.

Noncompetes are mostly bullshit in the EU. Startup lawyers know the CEO has read too much SV literature so they write down that clause to make them happy.

"Everything belongs to your employer" clauses seem scarier to me although I have never seen them enforced either. But if you are making your employees sign those you should know it will likely kill their motivation to work on side projects, which will make them less competitive and motivated at work.

Oh for sure. I just keep any ideas I have in my head and not tell them to anyone (inside or outside of the company).

You should sign what your trusted legal representation recommends you sign. Many of these situations are more nuanced than an internet blogger looking for clicks is going to make them out to be.

And yes, if you're making a 6-7 figure decision (which you often are when you sign an employment agreement as a software engineer), you should at least have an employment attorney give it a look through.

With respect to the off-hour IP clause nonsense, suppose you've signed one of those things but also gotten explicit written affirmation from the CEO that they don't give a rat's ass about your blog or book contracts or custom search engines or databases or contract work or open-source code that couldn't meaningfully compete with the company's actual business and that it's just a catch-all to ensure that if you do steal proprietary info then they're covered, and that they explicitly don't want you to actually notify them with all your new "ideas"; does such a clause still have any legal teeth you need to be wary of?

If they're willing to give that explicit affirmation, I'd be surprised if they weren't then willing to put in the contract (either by explicitly limiting the IP clause to specific things, or from certain things).

I've gotten resistance on this kind of thing once before; did a face-to-face with the person with the power (the board member acting as the temporary CEO) and they pretty much just wanted a vibe check that I wasn't trying to screw them over. Next day I got the contract back with all the alteration I'd asked for.

Everybody talks like they have a lawyer just sitting outside on their patio and all they have to do is give them a couple hundred bucks to look over a document here and there. How does one find a lawyer that will work piecemeal like that?

Most are teams right? And they go through stuff in bulk just like everyone else?

https://www.upcounsel.com/, "working piecemeal like that" is exactly what most lawyers do

Yeah, this is what I was looking for. In the past, Google searches have showed up with nothing. There wasn't a good way to hire someone for a small amount of work. Bookmarked!

Do non-competes include money? The ones I’ve seen include your salary for that period of time. It sounds fair. You ban the employee from job prospects but compensate them in pay. Maybe this varies by industry, geography, etc.

No, not always. In my state, they have to compensate you with some minimum amount. I don’t know what that is, but based on my current contract, my guess is that it’s the equivalent of one week of pay.

(I’m fine with it because it’s a small, and not particularly interesting, industry. Plus, I’m in a DevOps role: none of our five or ten competitors are going give me a bag to have me build CI/CD pipelines.)

I wonder how often non-compete clause are actually enforced. If I don't tell my employer what my next employer is and don't update my linkedin profile, I don't really see how it would actually works in practice.

In practice, they often only get enforced if you’re actually stealing customers and disrupting their business.

Or if your boss really dislikes that you are "disloyal" and left the company and uses company resources to pursue a vendetta.

I think I have clauses saying I can't work for competitors and that everything I do belongs to the company (not only on company time, company equipment, or on order from the company ). I have pointed out that the contract means that if I write a bestseller novel while employed, my employer owns it, which is obviously nonsense.

In reality, I never bothered arguing about these. I trust they aren't enforceable and I don't even fear having to pay the legal process should the megacorp try to hold the damn thing against me. They are that unenforceable.

oh I tore into the owner of a company with those clauses and ripped him a new one for about 10 minutes....disgusting practice. I refused his offer and told him he should be thankful he has anyone desperate enough to work for him. He apologized to save face...but didn't seem to care.

From the article:

> To be honest, I always assume good faith from people who offer me to sign some documents

Sure. And most people asking you to sign documents are doing so in good faith. But the contents of the documents themselves overwhelmingly bias toward the interests of the organization who wrote the contract.

Additionally, while the party asking you to sign may be doing it in good faith, they may not be the ones who end up pursuing enforcement. A contract should be evaluated based on its contents and never based on your trust of the individuals you are negotiating with.

Non competes are becoming less and less enforceable in the US.

I left my old company and wanted to start a competing business in a different vertical in the e-commerce space. What actually stopped me was the privacy and inventions and non disclosure agreements.

Pretty much it prevented me from using any know how I learned while at my last company and disallowed me from using any of the same suppliers and marketplaces to buy and sell on (of which there are few in my business domain).

In my experience, these types of agreements can be the actual thing that stops you from doing your own thing.

In Texas, non-competes are so restricted that employers can barely enforce them. I know people who signed non-competes, went to work for a competitor, and when they were sued the judge threw the case out because the non-compete clause was unenforceable according to Texas Law. It simply said "I agree not to start my own IT business or work for a competing IT business in three years of my departure" without specifying a range of distance that is enforceable.

... or move to the State of California which has laws that make such contracts illegal. I remember one contract I signed which had an addendum that read:

"section blah blah does not apply to residents of the State of California."

So 49 other state residents are getting a bad deal but California residents are getting a better deal, yet the company is doing just fine. Hmmm Maybe that section isn't needed anywhere?

If engineers actually had any leverage I would recommend we all collaborate on producing a one page addendum to all employment contracts that eliminates common nonsense.

My worst job hunting experience was going through a slimy recruiter and eventually receiving an offer from a company I was initially excited to work at until I read the absolutely bizarre and overbearing contract and tried for two weeks to tell them to just take all the weird, nonsensical stuff out and I would sign and eventually they pulled the offer.

iirc one of the clauses stated that I would make myself available to the employer to perform work for them on an as needed basis in the three months after quitting the job but the amount of work over that three months would never exceed 2 weeks in total blah blah blah.

Another one was something like agreeing make myself available to participate in legal disputes etc.

I asked them about examples of when these clauses had been enforced and what did that look like in practice etc? They remarked the first one was mostly done after hours etc. I just couldn't fathom why the heck any old regular engineer would sign off on a clause like that, but was told that "everyone signs it and we're not changing it".

Knowing I had the legal right to get any employment contract reviewed by a lawyer, I did exactly that. Good move indeed. The clauses were bad enough they tripped my BS meter, but the lawyer pointed out further BS in some of the vagueness of the wording. I think one example was the clause stating you had to make yourself available to the employer for work on an as needed basis after leaving the job had a sentence indicating that if you needed to travel you would bear the cost and/or there was something about a rate or amount of money that just was totally unspecified. She also rightly pointed out if you had another full time job you had just signed a contract for, you couldn't execute both contracts without being in violation of at least one of them and if the split with ths whacko employer was not amicable then they could absolutely have you over a barrel.

I got my lawyer to tell them to remove those things, and that's when they pulled the offer. It was a bit of a shock and quite upsetting to me at the time. During that phone conversation with the recruiter where he told me they were pulling the offer he revealed that a previous employee had stolen the source code and tried to set up a competing product and wound up in a legal dispute with the company, so the fact that I was "already getting lawyers involved" was a "red flag" to them. If you're paying careful attention you'll notice the absolutely circular logic of that absurd reasoning!!!! Anyway that at least explained sme of the weird, nonsensical, heavily defensive clauses, though not all of it.

Anyway I dodged an absolute bullet on that one.

after a lifetime of web development [started in 1996], you should ask yourself "can i build a full product". if the answer is yes, don't sign contracts and start your product. employers don't pay what you're worth. you can save them 250k in a 2 week period and they won't know you did it and definitely won't pay you like you did. they might even toss you to the side thinking "oh my nephew makes websites". you might have just increased your client's conversion rates by 3% because of an issue on the checkout page and when you call to report on it they might say "oh wow that must be the advertisement i bought without telling you".

in most cases, its too technical for them to understand. i recommend avoiding employers if you're money motivated.

I see this sentiment a lot but just because you are capable, doesn't mean your product will financially do better than working for said employer (i.e. you might be more valuable as part of that large machine).

How do you propose to go at it in said scenario?

I didn't sign a work contract because it was written in English and there was no translation available, especially since it contained a non-standard clause related to intellectual property rights. All communication before signing the contract had been in my native language.

You can also decline and often thats ok.

Whenever I had meetings with Google and went to their offices they had this sign-in process which is essentially a NDA while you are there. I always declined it.

It caused consternation in only that they were not used to anyone doing that.

This is exceptionally poor legal advice.

Non-competes are legit if they are narrowly limited in time and scope. It's perfectly fine for a company to demand that if they hand over their proprietary know-how to you, know-how that has cost them years to acquire, you won't take it to the competitor across the street. And no, an NDA is not enough to protect them. They own this information, not you, and no, you can't take it.

NDAs are legit for obvious reasons.

Work-for-hire clauses are absolutely required. If a company is paying you, they own what you create on company time and company equipment. No, you can't take it and sell it elsewhere. It's perfectly fine for you to resist signing a clause that says they own what you create offsite (so long as it's not related to your day job), but a company cannot continue to operate if employees can take what the company paid for.

Restricting the collective progress of humanity so that investors can make back their money.

Restricting the collective progress of humanity so that investors can profit.

It's never about making the money back, is it?

Maybe they are legal (definitely not here in California) but the moral argument you’re making doesn’t make much sense because it works both ways - company has no intention of unlearning your past years of experience when you leave and so neither must you

> It's perfectly fine for a company to demand that if they hand over their proprietary know-how to you, know-how that has cost them years to acquire, you won't take it to the competitor across the street.

This never happens. For software developers, most "proprietary know-how" is awful in-house inner platforms that work like shit but you're forced to use it because otherwise some senior vice president would have to admit he made a bad decision 9 years ago. The companies who try hardest to protect their trade secrets are exactly those companies with the dumbest secrets. There's absolutely no risk to the company that their employees will take their competitive advantage to some competitor "across the street".

What actually happens is that the company uses this as a prison fence to keep their employees from being able to leave when they treat them like shit.

> If a company is paying you, they own what you create on company time and company equipment

You're misrepresenting what those clauses say. Those clauses actually say "literally anything you ever do from the time of signing this document until the time you quit, we own, if we want it." If you draw an idea for a new fusion reactor on the back of a napkin late one night in a bar, your company now owns all rights to that design, and you are never allowed to do anything with it, ever. Yes, that's what they say. Yes, they're bullshit. That's why everyone hates them.

The WFH analysis seemed incorrect to me also, as a former lawyer. It seems like the advice is geared toward a potential employee, not a potential contractor. If you're a contractor, it's not true that

> If you work for a software hub, any SaaS app you build over the weekend will belong to the company, regardless of whether you do it with company property or not — as it's related to the company's business.

Also, I'm not sure what to make of this claim:

> Belonging to the company means everything, not just the IP — the revenue, the code, and the good vibes.

Isn't this assumed, for both employment and contracting? If you're writing code for someone, then yes they own the code, the associated IP, the revenue they're going to generate with it, and the "good vibes". Which one of these things would an employee or contractor think he's entitled to?

I can understand why companies want things under a work for hire contract. If work isn’t under a work for hire contract, you can just revoke their rights to it after 35 years due to how US copyright law works.

Dilbert strip that is there - had that happen. I dropped out of recruitment because they wanted to me to sign NDA. Well they were also not having top salary but I would go through.

Im just not made for this world, how and were can i outsource this ability to decipher legalesee somone willing to fix this for me for money, without exceeding the value gained?

Also had a contract with a customer that stated I could not make the same kind of tools for other customers. A bit to vague. Had it scrubbed of course.

would like to see a version of this called "contracts you should sign" -- like, what does a golden parachute clause look like? how do these executives keep walking away with so much money while floor employees are given 11 weeks, and it's out of generosity of management.

Why is the absence of a vesting period (for turning turning options to shares) a red flag?

What's wrong with gym contracts?

Its only a problem with certain large chains, but they are often set up so that they automatically charge you every month and it is very hard to cancel. If a gym doesn't accept cash and demands you pay by credit card, that's a huge red flag. Also check reviews of the gym before you sign up. And of course, actually read the contract before signing. They can waive certain clauses if you confront them. And if they don't, there are plenty of small gyms to chose from.