Noncompetes are one of the dirty realities of the brokerage business. The contract clauses have long been used to prevent key executives and talent from jumping ship to a rival, and have led to many bitter disputes. But what are they exactly, and how are they different from two other key contractual clauses, nonsolicits and clawbacks?
In the latest episode of Resi Rundown, a new series on news and emerging trends in residential brokerage, The Real Deal‘s Hiten Samtani breaks down the Federal Trade Commission’s proposal to ban noncompetes and simplifies other legalese that agents and brokerage employees need to know.
“Agents have always been independent contractors, so noncompetes were not relevant in their case,” Samtani said. “But sales managers and brokerage executives are employees, and that’s where it matters.”
Clawbacks and nonsolicits, however, can come into play for agents, and Samtani breaks down how they work.
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Watch the episode above, and stay tuned for more breakdowns of the most important news and trends in residential brokerage.