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New provisions on competition clauses

In 2011 it was expected that new provisions for competition clauses, customer clauses and non-recruitment clauses would come into force. As early as June 2010, the Department of Employment sent a proposal on new provisions in the Working Environment Act for comments.

The bill implies that particular reasons must exist if an employer shall be able to demand a competition clause, and that such clause should apply for a maximum of one year. The proposal also states as a condition for validity that the employer provides compensation to the employee during the period the employee is prohibited from engaging in competing activities. The bill has not yet come into force, but the Department has said that the bill will be put forward early in the new year.

Areas of practice: Employment law
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