Gov. Patrick on Non-Compete Agreements in Massachusetts

I had the chance to chat with Governor Deval Patrick for a few minutes today at Microsoft's NERD Center, toward the end of the Innovate MassTech meeting (aka the IT Collaborative Study Group Meeting.) So I asked him about non-competes.

Paul Sagan, the CEO of Akamai, had just said on stage that he is in favor of keeping non-compete agreements legal and enforceable in Massachusetts, and that he'd seen no data that says that non-competes have any effect on making us less competitive. (The best data I've seen comes from this excellent paper written by three folks at Harvard Business School.) Another CEO told me he liked the fact that employees were more loyal (or less mobile) than in California, so you didn't have to worry about constant turnover here.

Yet at the event, I also spoke with a number of people who'd either been prevented from hiring someone they wanted to hire because of Massachusetts' stance on non-competes, or who knew first-hand of someone who'd been prevented from moving from one company to another.

I asked Gov. Patrick whether the non-compete issue had shown up on his radar screen, and he said it had -- he'd heard about it here in Massachusetts and on a recent trip to California. "I don't have a stake in the status quo," he said. He'd heard arguments from individuals who have been prevented from taking jobs because of non-competes, and also from executives who feel that keeping employees from jumping to other firms in their industry helps them stay competitive. "There's not a consensus view" of whether they're a positive or negative thing in Massachusetts, he said. I suggested that larger companies would love for non-competes continue to continue to be enforceable, while many small start-ups would like to get rid of them -- and that the bigger companies have more political throw weight. The governor didn't agree that things break down so neatly between big and small.

He seemed like he's still in listening mode, willing to be persuaded: "If there's consensus in the industry [as to whether they're a good or bad thing], I'm happy to support that."

And then he went off to be pounced upon by the rest of the media mob... (see pic above)