Introduction
The rules for competition, relationship, and anti-solicitation clauses will soon change dramatically. This blog explains what new obligations employers and employees can expect and how this will affect employment contracts in the future.
New legislation in the works
Many employers include a competition, relationship or anti-solicitation clause in employment contracts as standard. Until now, the rules on these were quite broad, but that will soon change. There is a bill that imposes stricter requirements on these clauses. Importantly, the changes will apply not only to non-competition clauses, but also to non-solicitation and anti-competition clauses.
What exactly is changing and what does it mean for employers and employees?
Maximum duration of 12 months
The first major change is that a non-competition, non-solicitation or anti-solicitation clause may last up to 12 months after the end of employment. Currently, there is no legal limit to the duration of these clauses, so employers sometimes include clauses that last two years or longer. With the new rules, this will soon no longer be possible.
Duty to state reasons even for permanent contracts
Currently, an employer must justify why a non-competition or non-solicitation clause is necessary only in temporary contracts. In permanent contracts, such a clause can be included almost by default, without further explanation. This is going to change. In the future, an employer must also justify the necessity of the clause in the case of permanent employment. This will make it easier for employees to challenge the validity of such a clause if the justification is lacking or insufficient.
Compensation when the clause is enforced
A third major change is that employers will be required to pay compensation if they wish to hold an employee to a non-competition, non-solicitation or anti-solicitation clause after the end of employment. That compensation will be 50% of last-earned salary per month for as long as the clause is in effect. This means that employers must carefully consider whether it is really necessary to bind an employee to such a clause. Currently, such clauses are often included in almost every employment contract out of habit, even if there is no actual need for them.
Written confirmation after end of employment
Finally, the bill brings with it an obligation for employers to give written notice to the employee that they wish to maintain the clause after leaving employment and for how long. Without such confirmation, an employer cannot invoke the clause. This forces employers to actively consider the importance of the protection they want to achieve with the clause.
What does this mean in practice?
If passed, the bill will make it a lot harder for employers to include and enforce standard competition, relationship and anti-harassment clauses. For employees, this means more protection and better bargaining opportunities when they leave. Employers will in future have to provide better substantiation for clauses and will in many cases be obliged to pay compensation if they actually want to hold the employee to the clause.
Conclusion
The new bill makes it more difficult to include and enforce standard competition, relationship and anti-solicitation clauses. Employers must now justify why a clause is necessary and possibly pay compensation. Employees will thus have more protection and better bargaining opportunities when they leave.
This blog was written by Mr. Stijn Blom, employment lawyer at Arbeidsadvocaat.nl B.V. Stijn has extensive experience in employment law and assists entrepreneurs daily with a wide range of employment-related matters. From dismissal cases to drafting watertight contracts and policies – with his practical and personal approach, he helps employers and employees move forward. Want to know more?Visit Stijn's page.
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April 2025
