Personnel: Non-competition clause and non-solicitation clause: Write it down!

Employers often wish to make a non-competition and / or non-solicitation clause applicable on their employees. The law requires such a clause to be agreed upon “in writing”. What does this mean exactly?

Clauses restricting an employee’s opportunities to work for a new employer or start his or her own business after the termination of an employment contract must be agreed upon in writing by the employer and the employee of age. The reason for such a clause to be agreed upon in writing is that the employee must be able to thoroughly consider the consequences of this onerous clause.

Non-competition and non-solicitation clauses

There have been discussions on whether the requirement for a clause to be set out in writing not just applies to non-competition clauses but also to non-solicitation clauses. A recent judgement of the Supreme Court holds that the requirement for clauses to be set out in writing also applies to non-solicitation clause.

‘In writing’

But what does ‘in writing’ mean exactly? According to case law, this requirement is fulfilled in the following cases:

• The clause agreed upon is printed on paper, or
• The clause agreed upon is included in an e-mail.

The clause can also be included in another document (for instance, in staff rules) than the signed document. In this case one of the two following requirements must be fulfilled:

• The other document is an attachment to the signed document and the clause is referred to in the signed document.
• In the signed document, the employee explicitly declares to agree with the clause.

A generally phrased agreement with attached documents containing a non-competition and / or non-solicitation clause therefore does not fulfil the requirement for the clause to be set out in writing.

Contract for services

Regarding contracts for services, there is no legal requirement for non-competition or non-solicitation clauses to be agreed upon in writing. However, according to recent case law, the agreement of a self-employed worker without employees (zzp’er) with such a clause cannot be assumed too readily. Therefore, make sure you meet the requirement for the clause to be set out in writing not just with employees but also with contractors.

Advice

Do you, as an employer, want to make sure that a valid non-competition and / or non-solicitation clause has been agreed upon? We advise you to explicitly include such an agreement in the employment contract. Do you want to include such a clause in a fixed-term employment contract? Make sure that you meet the obligation to state reasons. Is the contract is (tacitly) renewed? Make sure to agree upon the clause in writing again because in the event of a new contract the old clause will lapse.

Contact

Would you like to learn more about including a non-competition clause or non-solicitation clause? Please contact us: