US Ban on Non-Compete Clauses May Raise Salaries for Bunker Traders

Non-compete clauses have not always been used in a fair and reasonable way in the bunker industry, Maritime Recruitment Company Ltd's Vernon Jayanathan tells Ship & Bunker.

The US is set to ban non-compete clauses in employment contracts, in a move likely to have a significant impact on the job market for bunker traders.

The Federal Trade Commission announced on Tuesday that it had voted by 3-2 to ban the clauses within 120 days. Existing non-compete clauses can still be enforced for senior executives.

The clauses are a common addition to contracts for bunker traders, to prevent traders leaving their employers easily and taking customer portfolios with them. A ban on the clauses -- particularly if other countries follow the example set by the US -- would be likely to result in higher salaries and better working conditions for bunker traders as more power is given to employees seeking to move roles.

The clauses can last as long as two years, and be applied globally or within a specific geographical area, Vernon Jayanathan, director of Maritime Recruitment Company Ltd, told Ship & Bunker on Wednesday.

"I think this latest ruling was because a lot of non-competes became less than fair and reasonable," Jayanathan said.

"If this had not been the case than this ruling would not have come about.

"I have come across  many good candidates who have been scared to leave because of such vexatious clauses.

"This creates resentment, which lead to the formation of some unpleasantly toxic workplace environments.

"This ruling will hopefully put an end to that.

"However, I must state that this should not be a green light for employees in this industry to act abrasively.

"Bad employers exist, but there are a lot more good ones out there.

"There are many who go above and beyond what is required of them as an employer and provide staff with a safe 'constant' in an increasingly unpredictable world.

"No matter what this ruling allows or not, I strongly encourage all concerned to behave with decency and integrity. It really is not that hard."