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this post was submitted on 14 May 2024
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This might get voted down, but y'all should hear the counterpoint. My friend requires new hires to sign a NC that expires after 2 years. It basically says the employee may not work for another company using the same equipment unless they pay him the $3000 it costs him to get them certified. Before he did that, some employees would jump to a competitor shortly after completing the training. Now he's wondering if he can make the $3000 an employee loan that will be forgiven after 2 years of employment.
And no, he doesn't do the NC if the new employee was already certified. He just wants to protect his investment in their training.
This change in the law will have consequences in businesses where employees require special certifications or training for a high demand specialty. Will an auto repair shop be willing to train an employee to service EVs if they can't guarantee the employee will remain with the shop?
If your friend paid a competitive wage with the other company using the same equipment, while also providing an equal or better working environment, he would be able to retain the employees, and find an equilibrium for those moving to and from his competitor.
The only reason he would need a contractual limitation is if he was offering worse wages or a worse working environment.
Counter point, the other company pays better because they save on training costs.
3000 isn't much when it comes to onboarding costs, so I don't think that's why, but imagine if it cost 10k,20k, etc.
For clarity, I'm very much in favor of this ruling. But I also sympathize with the above reply.
You have options like offering a guaranteed raise or bonus
An employer could offer an immediate $15,000 signing bonus to anyone who already has the certification, effectively outsourcing their training costs while pocketing the extra 5k of the 20k true cost