A Null And Void Non-Compete Clause Does Not Trigger Automatic Damages

Until now, there has been no requirement for an employee to demonstrate any loss suffered to be entitled to damages owing to a null and void non-compete clause inserted into his or her employment contract.

In its decision of 25 May 2016 (Cass.soc. 25 May 2016, n°14-20.578), the French Supreme Court reversed this approach. Henceforth, an employee will have to prove the loss suffered in order to claim damages.

In the present case, an employee of a professional investment company terminated his employment contract, alleging breaches of the contract by his employer immediately after he had received a notice summoning him to a pre-dismissal meeting.

Despite the non-compete clause in his employment contract, he set up a company with one of his colleagues to compete against his former employer. At the same time, the former employee lodged a file before the Employment Tribunal, making a number of claims against his former employer relating to the performance