Non Compete
During HF non-compete periods (3-6 months), do you usually get paid w/ benefits?
How enforceable is it as it’s a gray area as to who a competitor would be
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Just went through this so can add some color.
Yes, you get your salary and any benefits you were offered & had in-place.
Enforceability varies by state, but violating this would put you on a list you don't want to be on. Not worth the trouble, wait it out.
Some don’t provide benefits.
I worked for a very large fund >$25B AUM and they denied me health insurance during the noncompete. Had to pay for it myself.
wtf
Ya was told there wont be health insurance or pay during the non compete period...
Maybe I’m insane. But I’ve never heard of no health insurance. Or frankly no salary.
Reputable funds will likely have reached the conclusion that those parameters could affect enforceability.
I read that if they don't pay insurance or salary during this period, the courts will almost always side with the employee to break it...if that's a route they wanna take...
So I will chime in as someone on one of these now (from a very large fund). Pay is standard in every NCO I've seen. Insurance/Benefits are not. You are eligible via COBRA but pay out of pocket. Standard is pay base salary for the duration of the period.
Ya was told no base salary during this period. Hopefully, it's not too enforceable given I get nothing!
No base is not an enforceable non-compete. Consult a lawyer for legal advice ofcourse.
Ya most definitely that would be the play to consult legal advice, but overall sounds punitive for employees.
Maybe the FTC's proposed ban on noncompete clauses will go through!
False. There are definitely firms that have non competes which don’t pay any base or garden leave.
You can create a contract for almost anything. Enforcement is a different issue
Unfortunately not true, and I speak from personal experience. I worked at a HFT that had a 2 year *unpaid* non-compete and I signed it thinking it would be unenforceable and/or the company would surely negotiate something more reasonable when I left. But nope, when I quit, my lawyer confirmed it really is enforceable (or at least enforceable enough that they filed multiple lawsuits over it and won some of them). Turns out this company even enforced that unpaid 2 year non-compete on some of my coworkers who were fired without cause (not just quit). In my case, when I left, I had a little bit of leverage and eventually got them to agree to a 6 months *unpaid* to a another quant finance shop (that really was not realistically a competitor). To this day, I think 6 months unpaid to go to a non-HFT competitor seems unreasonable, but at least it was much better than the 2 year they were pushing for.
Definitely do not sign an unpaid non-compete. It is enforceable in many states.
Question about signing one of these out of undergrad. My HF has a one year non compete even as a new grad. How common / uncommon is this for top funds? Seems kinda concerning to me. Heard Bridgewater’s is also super long.
I know one person out of undergrad asked to sign a non compete but it was 6m and for a job which was going to pay 2-3x any other job they could get. Now that person is making 4-5x peers a few years later. So for that kind of gig, I see it. But if that’s not the path, then it’s nuts.
Is it a bad thing that I signed a non compete for a role even tho I am not 100% sure I wanna do it forever? I am in my last year of university so I can’t know
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