Some of the confusion about Schwab`s non-compete clause could be due to TD Ameritrade`s informal policy of looking the other way when employees with non-compete rules were working for a competitor. “The prohibitions on competition are limited to managers (TDA`s most senior managers) and employees who benefit from limited shares under TDA award agreements.” The San Francisco-based broker has offered many employees severance packages, including restricted shares that are unwavering, but it is handing over competition bans unlike TD Ameritrade in the past. “It depends on the broad definition of the agreements and it also depends on the state in which you live. If you live in California, [the courts] may not impose it because they are very friendly employees. But Texas could be more employer-friendly. The massive layoffs of the Schwab-TD Ameritrade merger have implicated many former employees in competition bans that are hampering their ability to find employment in the COVID-19 pandemic. The strength and applicability of non-competition rules vary from company to company and from state to state, he adds. For those who lost their jobs, “significant severance packages” were offered in exchange for signing the severance contract with a 12-month provision, Hooper said, adding that the competition bans were part of TD Ameritrade`s restricted stock policy. Schwab-TD Ameritrade merger layoffs leave many former employees tied up by competition bans and hamper job search amid the COVID-19 pandemic But a former TD Ameritrade employee says former employees were unable to get jobs at a lower level in a place like Fidelity because Schwab denied the waiver request. These two companies could be Schwab`s biggest online competitors. Former employees said Schwab executives did not offer a meeting or other communications to explain the form.
They had not just figured out how their job applications would be assessed or whether an appeal process was available. A Fidelity spokesperson confirmed that the company does not hire employees of TDA or elsewhere limited by a non-compete clause. Traditionally, there are no competitors because senior executives have inside information, Munoz says. “They are trying to scare employees into signing a non-competition clause. Non-competitors are not worth the paper on which they are printed. I think that is ridiculous. They`re trying to scare people, not to go to competitors,” he says. It is not known how many employees did not participate in competitions. A source told RIABiz that this provision has affected more than 200 employees, but Hooper says this figure is unclear. For more information: Lisa Bodnar, TD Corporate Communications, [email protected], tel. 647-928-4819; Sana Mehkri, Edelman Canada (for Intuit), [email protected], Ph:416.524.5456 Hooper says Schwab is “ready to consider non-compete requests.” Heckenberg assumes that the industry will optimise the enforcement of these competition bans in the coming years.