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THE CONCEPT AND ESSENCE OF THE NON-COMPETITION AGREEMENT

Every year, more and more employees may be faced with the fact that when hiring they are offered to sign a non-compete agreement. For some it will be something new, and others have repeatedly signed similar agreements.

What is a non-compete agreement?

A non-compete agreement is an agreement between an employee and an employer that an employee is restricted to work in a similar position for a certain period of time or to perform such work that he performs in a company that works.

Very often, non-compete agreements also stipulate that an employee may not engage in such activities for a certain period of time independently or for hire, which he is engaged in at the time of signing the agreement.

It seems logical that a company that has taught an employee something new in a certain field of activity fears that these skills may be used later against the company itself if the employee resigns.

But to what extent is it legal in the realities of Ukrainian legislation?

If we analyze the legislation of foreign countries, in some countries it is a common practice that is enshrined in law. That is, the legislation clearly stipulates the term for which such an agreement must be concluded and the conditions that must be provided for in it.
As for Ukraine, there is no provision in domestic legislation that would allow an employer to enter into such agreements.

The Labor Code of Ukraine states that everyone has the right to freely choose their activities, and that an agreement that violates the rights of workers is invalid. But in practice, many employers enjoy “freedom of contract” and such agreements are concluded.

Analyzing the case law, it should be noted that in Ukraine such agreements are concluded quite often. But in order for each party to be able to protect its interests as much as possible, it is necessary to take a balanced approach to signing such an agreement and taking into account all the nuances.

If it is easier for the employer to do it, because the company has a lawyer or a staff of lawyers, it is more difficult for the employee in this regard. After all, an employee can not always fully understand the essence of what he signs. And for violating the terms of the agreement are often not small sanctions.

The best option when concluding a non-compete agreement is not to hurry, but to study in detail the document that you will sign. Also, do not forget that such an agreement should be discussed with a lawyer or attorney, who will point out all the “pitfalls” that may arise.
In most cases, in addition to penalties, the agreement may specify the long term of the non-compete agreement. From 5 years and more from the moment of dismissal of the employee from the company.

As for the employer, it is necessary for him to detail and specify all the details in the non-competition agreement. Because the expected result depends on the smallest details. It is not known whether such an agreement will be considered in court in the future.

Therefore, as noted above, legal aid should not be neglected to achieve the desired outcome for each party to a non-compete agreement. After all, high-quality legal assistance and the conclusion of a non-compete agreement can consolidate the employer’s position in the market and reduce the risks associated with its activities.

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