Many employment contracts contain a non-competition clause or a relationship clause. These stipulations limit your options to start working with a new employer or maintaining contacts after your dismissal or departure. This can have far-reaching consequences for employees, especially when they want to make a new career move.
In this article, we explain what a non-competition and relationship clause are, when they are valid, and how you can defend yourself against them.
What is a non-competition clause?
A non-competition clause prohibits an employee from working for a competitor or starting a competing company after termination of the employment contract.
Important:
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It must be in writing.
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It can only be included in a permanent contract.
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In a temporary contract it’s only allowed with a weighty justification.
What is a relationship clause?
A relationship clause prohibits an employee from doing business with customers, suppliers or other relationships of the (former) employer after termination of the contract.
This clause is often found in commercial positions, but can be used in any sector.
When is a non-competition or relationship clause valid?
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The clause must be written in the employment contract.
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In temporary contracts, the employer must justify why it is necessary.
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The limitation must not be unreasonable; the judge can annul or restrict the clause if it goes too far.
How can you defend yourself against a non-competition or relationship clause?
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Negotiate at the conclusion of the contract or upon departure.
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Involve a judge: the judge can annul the clause in whole or in part.
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Claim compensation if the clause disproportionately disadvantages you.
Examples from practice
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Example 1: An employee with a temporary contract received a non-competition clause. The judge annulled this because there was no heavy justification.
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Example 2: An account manager was prohibited from contacting his old customers due to a relationship clause. The judge limited the clause to only 6 months.
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Example 3: An employee received permission to work for a competitor but negotiated a compensation from his employer.
Checklist for non-competition and relationship clauses
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📄 Is the clause clearly written in your contract?
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⏳ Is the clause in a temporary contract without motivation? Then it is invalid.
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🧑⚖️ Is the clause too extensive (e.g. too long duration or too large area)? Then the judge can limit this.
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💶 Ask for compensation if the clause hinders you in a new job.
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⚖️ Always have your contract legally reviewed.
Common mistakes
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Thinking that a non-competition clause is always legally valid.
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Not objecting to a too strict relationship clause.
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Agreeing too quickly without negotiation.
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Not realizing that the judge can limit or annul the clause.
Frequently Asked Questions (FAQ)
1. Can a non-competition clause be in a temporary contract?
Only with a heavy written justification by the employer.
2. How long can a non-competition clause last?
Usually 1 to 2 years; longer periods are often unreasonable.
3. Can I challenge a non-competition clause?
Yes, it can be annulled entirely or in part by a judge.
4. What is the difference between a non-competition clause and relationship clause?
Non-competition is about working for a competitor, relationship clause is about doing business with customers/relationships of your old employer.
5. Do I get a compensation if I am bound to a non-competition clause?
That’s possible, especially if the clause seriously hinders you.
Why choose Arslan Lawyers?
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Specialized in employment law and contractual stipulations
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Experienced in annulling or limiting too strict non-competition and relationship clauses
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Negotiating about restrictions or compensations
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Protecting your career and career opportunities
Conclusion
A non-competition clause or relationship clause can seriously limit your freedom in the labor market. Fortunately, there are legal boundaries, and you can often negotiate or have the clause annulled. Always have your contract reviewed before you sign or switch to a new employer.
