Non-competition clause

A non-competition clause should always be agreed upon in writing in order to be valid. Even if a non-competition clause is legally agreed upon, it cannot always be fully enforced by your employer. It is doubtful if a non-competition clause is still valid if an employee obtained another position within the company whereas the initial non-competition clause has not changed. The cantonal judge can be asked to annul the entire or partial non-competition clause. You may also ask to suspend the non-competition clause in summary proceedings.

Non-compete clause in fixed-term contract

Fixed-term employment contracts concluded on or after 1 January 2015 may no longer include a non-competition clause, unless it is necessary on account of weighty company interests.

A non-competition clause in a fixed-term contract concluded as from 1 January 2015 must contain the weighty interests involved in writing and explain why these interests make including a non-competition clause necessary. The interests must relate to temporary and specific duties or specific (high) positions in which the benefits to the employer of including the non-competition clause outweigh the drawbacks for the employee. In practice this will mainly count for employees in higher positions who will directly receive important, business sensitive information. The non-competition clause will have to comply with these conditions both when it is agreed and when the employer wishes to invoke it.

A non-competition clause in a fixed-term contract concluded as from 1 January 2015 without the reasons stated is void. If the reasons are stated in the clause, the court may annul the clause in full if, according to the court, the clause is not necessary in view of the interests stated by the employer. The court may annul the clause in full or in part if, according to the court, the non-competition clause is too detrimental to the employee compared to the interest of the employer in retaining it.

The above also applies to the business relations clause, since the court views a business relations clause as a form of non-competition clause.

Summary proceedings

In summary proceedings the cantonal judge will have to estimate if the non-competition clause is eligible for a partial or entire annulment. The judge will have to balance the interests of your employer in maintaining the competition clause and your interests in the moderation of it. Lots of arguments can be put forward. These aspects are taken into consideration:

  • the training you had with your employer
  • the length of the employment contract
  • the know-how you acquired with your employer
  • to what degree sales are endangered when violating the non-competition clause
  • the degree of getting a considerable promotion
  • the way you are restricted in your future possibilities by the non-competition clause

The extent to which a judge will moderate a non-competition clause will depend on how reasonable the clause is. A competition clause which is quite broad in place and time will be restricted sooner than a clause that accurately describes the activities to be done and which is confined in place and time.

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Contact us now

Talk to an expert

If you wish to switch to a competitor we advise you to contact us in order to estimate the risks. There might be a chance you are prohibited to start at your new employer whereas your old employment contract has ended.

Sec Employment Lawyers

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Charlotte Buijsman

Michiel Dekker

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