Non-Compete/Non-Disclosure Agreement for European Union

What's prohibited

• Non-compete restriction without financial compensation during the restriction period

  In most EU member states, a non-compete agreement that does not provide financial compensation during the restriction period is void or voidable. The Transparent and Predictable Working Conditions Directive (2019/1152, Article 9(2)) prohibits member states from allowing non-competes that are 'unjustified', most states interpret this as requiring compensation. Typical compensation ranges from 30% to 100% of the employee's salary depending on the member state.

• Restrictions exceeding 2 years or covering an unreasonably broad geographic area

  Under the proportionality principle applied in most EU member states, non-compete restrictions exceeding 1-2 years are generally considered disproportionate and unenforceable. Similarly, geographic restrictions must be proportionate to the employer's actual competitive area.

Other contracts for European Union