| >> I'm amazed that the contract Star Theory had with Take-Two didn't have a clause prohibiting Take-Two from poaching employees like this. I'm amazed that people sign contracts accepting this kind of restrictions to their lives. That's (fortunately) illegal in the EU country I live in, as it creates artificial barriers in the job "market", i.e. it is illegal to limit people's access to work. Still, cartel practices like not hiring from "friendly companies" abound. >> If I hire a consultancy company to build something for me, would I normally be able to directly hire the employees who did the work? I see contracts imposing restrictions like this all the time where I live, and people sadly just nod and accept, but these clauses never hold up in court as no company has a right to decide where people can or can't work. Having worked as a consultant, I'm repulsed by the idea that I'd need my company's permission to leave and go work for a client. Especially because the provision stinks of "cheaper than actually investing in people retention". If the issue is intellectual property transfer, that's what an NDA is for. |
I believe he's talking about a contract between the companies, not contracts with individual employees. That may be different.
An employer making an employee sign a contract saying that they won't work elsewhere without the employer's permission has obvious problems, such as the vast (usually) difference in bargaining power between an employer and an individual employee, and it gives the employer massive control over the employee's life.
I believe that those are the main reasons many jurisdictions make such clauses unenforceable.
In the case of two companies making a deal that company A will buy a service from company B and not hire away B's employees, you are much less likely to have such a great disparity in bargaining power. Unless it's a very small industry, B's employees probably have many other job opportunities in that industry besides A and other companies B has worked for.
That suggests that there might not be such strong public policy reasons for make such contract unenforceable, especially if they have some time limit such as B's employees can't be hired by A for a year after working on B's service for A.
Almost every court case I can recall hearing of in this area was either (1) contracts between companies and individual employees, not between companies, or (2) arrangements between competing companies to try to limit labor mobility to keep salaries down, which raised antitrust issues.