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Big problem with NON-COMPETE term, increasingly common
Thread poster: JW Narins

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
Jun 28

[Moderator - if there is a better place for this, please move it!]

More and more I'm seeing noncompete terms in contracts - with freelancers! This makes sense when you work with a company, in-house for a few years. But think about what it means for us!

Example: "During the term of the contract and for ___ months thereafter, [X] will not, directly or indirectly, solicit any translation from clients of [Y]."

That means that if Y posts a job to ProZ and you apply for it, you're in violation. You'd have to KNOW all of Y's clients (which you don't) and CONSTANTLY MONITOR your business against that (changing) list.
Moreover, of their client in a medical case turns to a different firm for translation of an immigration document, you'd be in violation if you bid for that firm's work.

The most anyone should ever agree to is "I undertake not to approach customers I am interacting with in the course of and as the result of performing this contract for [Y] with the intention and result of cutting [Y] out of contractual relationships it would otherwise have had," or something like that.

We need to start objecting to these terms.


 

DZiW
Ukraine
English to Russian
+ ...
professional deformation of a personality Jun 28

John, it's a pity so many decent linguists are still but poor businessmen, seeking any wannabe clients in futile pursuit of global acceptance, alas. You just can't please everyone!

How about waiving an event of default or the right to counsel, not to mention forgoing the right of reply or resigning the rights at all? Do they really read, completely understand, and deliberately sign such offers?

A contract is an agreement between two or more parties with the veto right

It's no ultimatum, nor a blackmail, yet most translators are taught to be yielding--at their own expense--and refrain from negotiations, let alone altering any terms.

Perhaps, it's just a difference between people working with other people (such as interpreters) and working with papers (translators), but the trend is alarming. A couple of years ago my colleague mostly working as an interpreter got an interesting offer yet with a shady arbitration clause to waive the right of court--in favor of the company's arbitration. She just crossed it and some items out from the draft, adding a local transportation and other costs. Soon her prospect boss wanted to know the reasons, and she did win the $200K contract.

As for "funny" disclaimers, are translators really rule their biz, if they blindly sign such constrains?


JW Narins
Dmytro Nehrii
 

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
TOPIC STARTER
It is true Jun 29

Too true.

I'm glad the "just crossed out the clause" story had a happy ending.

This kind of thing, though, will become a bigger and bigger problem; if only we could band together to refuse the more ridiculous common clauses.


 

Maxi Schwarz
Local time: 09:49
German to English
+ ...
Just say no Jun 29

I don't see this is a new or increasing trend. I saw such clauses 20 years ago. I didn't sign them then, and don't do so now. The only reason that personally I see less of them is because I'm fairly well established these days with my regular clients, and the clients I have who recommend me, do so to people who don't create such contracts.

Eva Stoppa
ahartje
José Henrique Lamensdorf
Dan Lucas
Adam Jarczyk
Jenni Tuhkanen
 

Christine Andersen  Identity Verified
Denmark
Local time: 16:49
Member (2003)
Danish to English
+ ...
Add the word "knowingly" Jun 29

You can adapt the clause and its variants, for example:

"During the term of the contract and for ___ months thereafter, [X] will not, directly or indirectly, KNOWINGLY solicit any translation from clients of [Y]."

or "During the term of the contract and for ___ months thereafter, [X] will not, directly or indirectly, solicit any translation from clients whom [X] KNOWS TO BE CLIENTS OF [Y]."

I know at least one colleague who has asked for a list of clients she should avoid, which of course, should be updated regularly. AFAIK she was never given one, but then she was able to reach a realistic agreement.

If you can see from the text you are translating who the end client is, then obviously, you should not approach the end-client directly. You do have to observe basic ethics in looking for clients, but if you cannot easily see or find out whether they are “clients of [Y]”, then I would assume you are entitled to approach them.

Some agencies mention major clients on their websites, so you could check whether agency [Y] does so, and avoid clients mentioned, but there will still be other clients you can approach.

I agree that as it stands, that clause and its variants can place unreasonable limitations on freelancers.


Angie Garbarino
Arkadiusz Jasiński
Tina Vonhof
Adam Jarczyk
 

Sheila Wilson  Identity Verified
Spain
Local time: 15:49
Member (2007)
English
+ ...
Brokers adding to the problem? Jun 29

I've never had any problems leaving a nn-compete clause in, although I do sometimes insert the word "knowingly". Just because a text is about a leading brand of pet food doesn't mean that the end client is its producer.

But AFAIK I've never worked on a project for an agency whose client was another agency. I can visualise enormous problems with these clauses if you're at the bottom of a long chain, with the top agency farming out work from one end client to several brokers who each pass it down to one or more other brokers, and so on.


 

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
TOPIC STARTER
The clause is far more restrictive than you guys are seeing. Jun 29

I don't think you guys realize what these clauses actually mean. The word "indirectly" is as problematic as the absence of the word "knowingly."

But beyond even that, OF COURSE you should usually be able to directly solicit a client of theirs - imagine, for instance, that a client of theirs is posting jobs to ProZ.com (directly OR indirectly). Why would this company be interested in making sure you don't get the work? They're ALREADY finding someone new to do it! It's hobbling your career with no benefit to them.

I reality, if you bid for a job on ProZ.com listed by a firm, you don't even KNOW whether you're soliciting (indirectly) a client of this client - because you don't know who the job is ultimately for.

The only interest they could reasonably be trying to correct is this: to prevent you from talking to clients of theirs with whom they've put you in DIRECT contact, to prevent you trying agree with them to cut out the middleman (the company writing the contract for you). But the noncompete clause NEVER actually says that - it covers a crazily broad range of situations.


José Henrique Lamensdorf
 

Chris S  Identity Verified
United Kingdom
Swedish to English
+ ...
How common? Jun 29

I've only ever seen (and signed) non-compete clauses that aim specifically to stop me stealing the end-clients that I do work for, which is fair enough.

They cannot expect you not to apply for work from other agencies also working for end-clients of theirs. That's just silly.


 

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
TOPIC STARTER
Silly Jun 29

It would be silly.

But I strongly suspect that, if you think about the noncompete clauses you HAVE signed, that's what they actually say, silly as that is.

I agree, noncompetes SHOULD be there to prevent you from trying to cut out the middleman - not only knowingly, not only directly, but IN THE COURSE of your work for them. I've never seen one, however, that says only that.


 

Christine Andersen  Identity Verified
Denmark
Local time: 16:49
Member (2003)
Danish to English
+ ...
I think 'knowingly' is enough Jun 29

In Europe we love to blame American litigation lawyers for all sorts of unreasonable contract terms, whether fairly or not.

I make a fuss about some of the very vague and far-reaching indemnity clauses which also crop up - a freelancer simply does not have the assets to 'hold harmless' each and every person, directly or indirectly affected, for each or every … remotely possible connection with a translation error… etc. etc.

However, there IS also a principle of reasonableness and enforceability in law.
Agency [Y] or whatever we choose to call them has to discover which clients you have approached while looking for business. Consider how (un)likely it is that they will find out which clients you have approached. (That is not an excuse for approaching their clients unethically, but if you simply approach clients who may be interested in your services, Agency [Y] is not likely to know whom you have approached.)

OK, suppose they have discovered anyway, that you approached one of their clients.
If you insert the word 'knowingly' in the clause and Agency [Y] agrees to it, they still have to prove that you knew, or ought to have known, that you were approaching one of their clients. If they have not given a list of their clients or otherwise enabled you to exclude their clients through due diligence, then they cannot stop you from approaching possible clients.

There is also the principle of consideration.
Unlike a freelancer, an employee may be placed under a competition clause, normally after leaving employment with a particular employer. In Danish/European law at least, there must be a time limit, and the employer has to pay compensation for limiting the employee's chances of finding work again in his/her field of expertise during that time. The compensation may be quite a large proportion of the employee's salary.

A freelancer does not have that kind of contractual relationship with the client, and the client is not offering any compensation for limiting your rights to look for work on a free market. Because you are a freelancer, they must know that you are going to work with other clients. It would simply not stand up in court, if they actually tried to prevent you from making a living. Or so I hope!


Michele Fauble
 

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
TOPIC STARTER
Principle of reasonableness Jun 29

"However, there IS also a principle of reasonableness and enforceability in law."
Really? These days, courts are happily advancing new principles of enforcement for out and out contracts of adhesion - exactly where a "principle of reasonableness" would be most needed. Do you have any clear reason for thinking this you can advance? I ask because I think you're presuming it, and it would be nice if you could, but I don't think that's the case.

As for enforcement - yes, you're right. The best protection you have is the unlikelihood that these things would be acted upon. And thank God for that.

But no one wins when we're all signing contracts we don't mean. The value of this is not mutual deceit and possible subsequent conflict, but mutual agreement avoiding subsequent conflict.


 

Sheila Wilson  Identity Verified
Spain
Local time: 15:49
Member (2007)
English
+ ...
I have proof that a French court allowed reasonableness Jun 29

JW Narins wrote:
These days, courts are happily advancing new principles of enforcement for out and out contracts of adhesion - exactly where a "principle of reasonableness" would be most needed. Do you have any clear reason for thinking this you can advance? I ask because I think you're presuming it, and it would be nice if you could, but I don't think that's the case.

If I can jump in here, I had cause to sue a teaching client in a French Small Claims Court a few years back. I had (very stupidly icon_frown.gif ) signed a contract that included a clause that said I'd be paid on completion of each course of English lessons given. Now, one student, a middle-aged businessman with very few words of English, decided after a few lessons that it really wasn't going to change the course of his career, so he gave up. I presented my invoice (for €400 if I remember rightly) as the course had ended. They refused to accept it, saying that I had to agree to teach a different student for the remaining hours. Fine, but this student was far further away and only available in the evenings - when I wasn't available. So I refused. I eventually had to take them to court and the judge said that the clause was abusive, even though the client had thought it watertight! The court ruling was that I was entitled to every cent, plus interest, costs, other expenses... The client was so adamant that they were in the right that they didn't respond to the bailiff the first time. When he went back with a police escort they had to pay more than twice the original invoice amount.

I'm absolutely sure that court would also rule in favour of freelancers who are not trying to steal clients or cut agency clients out of the loop, but instead are just trying to run a freelance business.


Jo Macdonald
Matthias Eng
Christine Andersen
 

JW Narins  Identity Verified
United States
Local time: 10:49
Member (2015)
Russian to English
+ ...
TOPIC STARTER
Absolute certainty? Jun 29

That's one case, and I'm very glad it went that way. Are you really absolutely certain that every case goes that way? To be blunt: you really shouldn't be, and it's not the case.

But more to the point - you actually had to go to court over this? In my view, that's already a loss. And if in this case you could have simply chosen not to, we're talking about a clause where it's the other side that could drag you in.


 

Sheila Wilson  Identity Verified
Spain
Local time: 15:49
Member (2007)
English
+ ...
The vast majority of clients don't spend time trying to entrap us. Avoid those that clearly do. Jun 29

JW Narins wrote:
Are you really absolutely certain that every case goes that way? To be blunt: you really shouldn't be, and it's not the case.

No, of course I don't know the results of every case and I'm sure there are some where blame lies on both sides, so results are always open to question. But do you have proof to back up your claim? Are you a lawyer? I imagine only they can really vouch for the likely acceptability or not of clauses - and then only for a particular jurisdiction.

But more to the point - you actually had to go to court over this? In my view, that's already a loss. And if in this case you could have simply chosen not to, we're talking about a clause where it's the other side that could drag you in.

Well, isn't that what the courts are there for? As a last resort? I've been freelancing for over 20 years now, and for the last 10 as I've come to specialise more and more in tidying English texts, I've done business with clients in over 30 countries. I've never lost a cent in those 20 years apart from two bankruptcies. So it really is a last resort. I've always been really careful about due diligence, choosing my clients carefully and then making sure everything is formalised at first before relaxing somewhat into a routine. Although I can see the need for being careful, I don't see the need for alarmism over this particular clause being discussed.

I hope I don't have to eat my words icon_wink.gif .


 

DZiW
Ukraine
English to Russian
+ ...
occupational medicine Jun 29

John, are you really trying to save the World in vain?

A clever businessmen should see why and what for--and what's worth what.
If they sign something without understanding, then just let them learn it the hard way.

However, in the view of freelancing vs GDPR-NDA-like globalization trends, such anti-competition may look even "funnier", yet for the signers only. Let inattentive and careless stew in own juice, why?


 
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