Knowledge at Work: Disputes Over the Ownership of Human Capital in the Changing Workplace

Abstract

In this article, Professor Stone argues that the nature of the employment relationship is changing in ways that are in tension with emerging trends in the law of post-employment restraints. Specifically, she argues that employers today seek to attract talented employees and to motivate employees to use their knowledge, expertise and imaginations on behalf of the firm. To obtain commitment and organizational citizenship behavior, employers implicitly promise to provide employees with training and networking opportunities that will enable them to develop skills that they can use in the labor market. However, employers have also become ever more conscious of the economic value of employees' knowledge. Hence they seek to control how that knowledge is used and thus increasingly seek to impose restraints on employee mobility by means of covenants not to compete or trade secret protection. These trends stand in tension with each other. Rather than address this tension, courts have adopted new doctrinal approaches in the area of noncompete covenants and trade secrets that favor employers. The author argues that courts should reverse their current pro-employer approaches and instead weigh the implicit terms of the employment relationship in their deliberations.