Our experience shows that many management board members are
still performing their duties on the basis of an employment
contract instead of a proper management board member agreement. As
the Employment Contracts Act does not extend to management board
members, we advise signing proper management board member
agreements. Conclusion of a management board member agreement
is in the interest of both management board members and the
company.
A management board member agreement allows greater protection of
the rights and interests of companies by defining non-disclosure
and non-compete obligations. As Estonian legislation does not
define what exactly can be regarded as company business secrets, we
recommend stating an indicative list in the management board member
agreement. Even if a general non-compete obligation is included in
the Commercial Code we recommend further defining (prohibited)
competitive activities, including their territorial scope and
expiry date. For
