Competition & Relation Clauses

As an employer, you have great interest in preventing sensitive corporate information, e.g: your customer database, product information and market strategies from getting into the hands of your competitors. You will also want to prevent your employees from approaching your customers in an attempt to lure them and their business away from you, during or upon termination of their employment at your company.

We advise all employers to include competition and/or so-called relation clauses in their employment contracts. Employers should also note that competition and/or relation clauses already in effect do not necessarily automatically apply in the event that the employee were to attain a different (higher) position within the company.

It is therefore most important to construct any competition and/or relation clause in such a way, that your interests as an employer remain safe at all times.

The law does, however, not allow employers to limit an employee's freedom of movement on the labour market absolutely. As an employer, you are therefore required to properly formulate such a clause. This may include e.g.: a proper time limit and/or geographic scope. If you were to formulate the competition clause too broadly, there is a risk that, in court, the clause will, either partially or entirely, be nullified.

The utmost care must be taken in drafting a competition and/or relation clause and should be made-to-order to your business specifications. Fruytier Lawyers in Business specializes in drafting competition and/or relation clauses. We can also advise and assist you in case of any dispute regarding (the interpretation of) a competition clause. Please contact Mr. M. van Westendorp, Mrs. B.J.C. Boogers-de Haan or Mr. N.Ch. Ellens for any questions/legal issues you may have regarding (the interpretation of) a competition clause.

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