I am reviewing a contract for employment and I am confused about a section on the contract. The section is non competition obligation, as I understand I will not be able to work in the same feild if the company and I depart ways anytime in the future. I have the question into the company for clarification, but I was wondering if this was normal for a contract with a Swiss company.

Thank you for your assistance

Non Competition Obligation

Upon termination of the Contract, the Employee shall not enter into any activity in any business, company and/or partnership which competes, directly or indirectly, with the business of the Company and/or the business of the Group.

Such non competition obligation shall last 12 (twelve) months from termination of the Contract. It is contracted without any compensation from the Company nor the Group whatsoever. It is not restricted to the territory of Switzerland.

I think this is fairly normal. I think I had a similar clause in my UK contract. I am not sure about your situation, but in my situation, it didn't preclude me from working elsewhere in my field because not every single similar job would be with a direct competitor. For instance, I would have thought that if you were in IT in banking, this clause would not stop you from working in IT in another bank (or in another company), because the business you carried out there would not be in conflict with the business you carry out currently (the two IT products are different). Most products/business activities have a limited range. I guess it depends on your field as to how problematic it is.

kfc.

	Quote:
	Upon termination of the Contract, the Employee shall not enter into any activity in any business, company and/or partnership which competes, directly or indirectly, with the business of the Company and/or the business of the Group.

I would not accept this in a zillion years. The construal is entirely up to the employer.

	Quote:
	Such non competition obligation shall last 12 (twelve) months from termination of the Contract. It is contracted without any compensation from the Company nor the Group whatsoever. It is not restricted to the territory of Switzerland.

Personally, I have never gone over three to six months, i.e. gardening leave period on this & have worked for a number of companies on a an international basis. Presently I am on 6 months paid, either way.

Basically if they are prepared to pay you salary for 12 months go for it, but I would never accept a prospective employer legally preventing me from gaining employment.

That would be like telling a car mechanic he can't work on cars after he left the company. That's all he can do - his profession. I'm not a lawyer, but I have a hard time believing that would stand up in court.

A car mechanic is unlikely to take business with him/her when they leave their post to work for another garage.

This is a restrictive practices clause is is very common in contracts both of employment contracts of key personnel and also on sale of a business...

I agree, especially on sale of business, which makes complete sense. However tagging someone with a non-compete for 12 months in an employment sense is a little more than restrictive.
Also, the first paragraph is so ambigous & slanted towards the employer, I would never accept it in its current wording.

The very wording "the Employee shall not enter into any activity in any business, company and/or partnership which competes, directly or indirectly, with the business of the Company and/or the business of the Group." is vague and ridiculous.

The fact that it seems to crop up in many employment contracts without being seriously questioned is even more ridiculous.
I would not accept it as is, imo request that the company revises the statement to indicate:
• Exactly what activity it is referring to,
• Define the term “Termination of contract” – i.e. if your contract is not renewed due to no fault of yours,
• If they are not willing to revise then they should be prepared to agree in writing to pay a reasonable form of compensation for loss of income during the 12 month period when you are not allowed to be employed doing what you are skilled at.

At the end of the day it is pretty common and probably not as serious as it seems, think about it, what are they going to do to you or your new employer?

I also have a non competition clause in my contract. When i asked my lawyer about it, he told me it was a common practice for certain positions. But to be valid, it should state clearly what are the competitors you cannot work for, which positions you could noy accept, on which countries.... Basically, this is of little legal value, becuase it is too vague and imprecise. By then, he also told me to sign it without any further challenging - if i really wanted to work for a competitor there would be many ways to go around this document.

Also, former employer cannot deprive you to the right of working and earn your money.... if you selll spoons and that is all you can do, your former employer has no right to cut you out from the spoon industry and deprive you from the only job you can do.

Hope this helps and best of luck,

Lucy

Lucy has just written pretty much what I was about to write. Nobody can enforce any contract clause that will deprive you of your livelihood.

Despite this clause being laughable, the icing on the cake for me was that they expect it also apply outside Switzerland. Classic...

Unfortunately many people get confused by the fact that such clauses appear in many contracts. This might lead many to believe that such situations are "normal", even though they may be unenforceable and in some cases illegal.

Another classic example is bottom-feeding UK recruitment agents often present contracts where the contractor can be terminated with 7 days' notice, but the contractor must give 4 weeks' notice if he wants to terminate. This is of course also an example of a clause which is not valid - both sides must be treated the same.

There are cases where anti-competition clauses are applicable but this is usually at a much higher level (for example CEO), where they can't go to a competitor or work within the same industry for a certain period of time. (many CEOs could simply switch to a different industry). However, they are usually paid their salary for this time or given such a big golden handshake that they don't care.

In the case of a company being worried about you taking trade secrets or information to another company - this should be handled by the signing of a separate non-disclosure agreement, rather than attempting to stop you working for the competition. If it was found that you'd revealed something which was covered by this agreement, then they could go after you.

I'd definitely have a go at getting the clause removed before you sign. My last employer wanted me to sign a contract with similar wording, but for a period of 2 years! It made very little sense to me, since my position had no customer /competitor/supplier contact. So I asked them to modify the contract such that I was only prohibited from working for employers with whom I'd built a relationship at said company. They didn't have a problem with that, so you might see what you can do to have your contract changed a bit too.

Lance

Thank you all very much for your assistance. I questioned my prospective employer and they agreed to remove the whole section. That surprised me, I figured we would negotiate.

Once again thanks to all of you.