Employee non-competition agreement

A non-competition agreement may be concluded with the employee for the duration of the period of employment or after its dissolution. In both cases, for its validity, it must be in writing.

1. Non-competition agreement during the period of employment:
In accordance with article 1011 § 1 of the Polish Labor Code, to the extent specified in a separate agreement, an employee cannot perform any activity competitive to the employer or to perform work under an employment relationship or on a different basis to the entity conducting such activities (non-competition). This agreement may be concluded simultaneously with the employment contract, and in the technical sense may be part of an employment contract or take the form of a separate document, but it is always an independent legal entity.

The period of validity of the agreement in question may not extend beyond the duration of the employment relationship and therefore termination of employment results in its extinction. Moreover, the contract may be unpaid or provide cash benefits for the employee, depending on how the content will be formulated. In turn, the competitive activity must be understood as a commercial activity undertaken for your own account (as an entrepreneur) or for the account of a third party (as an employee, contractor, and the like), if these actions overlap, at least in part, with the scope of the employer's business. This applies both to the production of goods or services of the same type as well as goods and services similar to those of the employer, which may replace them.

The agreement should specify the types of activities prohibited and the territory covered by this prohibition.

2. Non-competition agreement after the termination of the employment.
The Non-compete agreement after termination of employment may be established only if the employee had access to particularly sensitive information whose disclosure could expose the employer to the damage. Such agreement shall specify the period of prohibition of competition and the amount of compensation payable to the employee of this title. The compensation cannot be lower than 25% of the remuneration received by the employee prior to termination of employment, for a period equal to the period of prohibition of competition. Compensation may be paid in monthly installments. Non-competition clause ceases to apply before the expiration of period for which an agreement was concluded in the event of cessation of the reasons justifying such a prohibition or failure to comply with the employer's obligation to pay the compensation.

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