Tech community warns against noncompete half-steps: ‘We’re losing the war on talent’

(Shutterstock)
(Shutterstock)

At today’s State House hearing on noncompetes, prominent members of the local tech startup and investment community were once again loud and clear about their desire to rid the state of the agreements. A compromise looks much more likely, however.

That could mean limits to noncompetes such as a shortened duration for the agreements — to six months after the end of employment, perhaps — as well as an exemption for low-wage hourly workers.

For some workers in the state, even the compromise could represent a huge help. Among those who testified today was Colette Buser, who had signed a noncompete at age 16 to become a counselor at a summer camp in Wellesley, LINX. Since leaving, she has been barred from working at a different camp.

Limiting noncompetes to six months would also be preferable over agreements that prevent workers for moving to a competing company for a full year, of course.

But in startup time, six months is still an eternity. It’s a full half year for an employee or entrepreneur to mull the option of heading somewhere that the agreement can’t be enforced — the most obvious being California.

And that is something that’s undoubtedly on the minds of some tech founders in Boston — even well-established entrepreneurs such as Andy Palmer, the Vertica co-founder now behind the Koa Labs startup office and Cambridge startup Tamr.

Palmer’s message to state lawmakers today: “Please pass this bill without compromise.”

“Please do not make me and folks like me move to California,” he said.

Palmer clearly doesn’t seem convinced that a partial curb on noncompetes would make much of a difference for Boston’s own competitiveness in the tech world.

And others who spoke today — including Steve Kraus of Bessemer Venture Partners and Rich Miner, the Android co-founder and Google Ventures investor — made no mention of being interested in a compromise but did put in stark terms the competition for talent with California. Kraus said he’s recently spent a large amount of time in California, and reported that “we’re losing the war on talent” to the state.

Miner, meanwhile, said “there’s no doubt in my mind that [noncompetes are] putting friction on the wheels of innovation in Massachusetts.” Would a six-month max on noncompetes substantially change that? I’m doubtful, for the reason stated above: many startup founders and tech employees move at light speed, and the proposed changes seem likely to do little to change anyone’s mind about leaving Massachusetts.

What do you think? Let us know in the comments below.

Kyle Alspach has worked in journalism in Massachusetts since 2005 and was one of the original staff writers at BetaBoston.
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