international employment law firm alliance L&E Global

Sweden: Game programmers’ post termination restrictions were considered unreasonable by the Labour Court as regards non-solicitation of employees

A company in the game development industry applied clauses on non-solicitation of employees in the employment agreements for its game programmers had been granted two different interim measures on security measures as regards former employees to stop them from soliciting employees to their new employers. Interim measures were also granted in relation to the former employees’ new employers. The non-solicitation clauses provided a prohibition for the employees, without the right to any economic compensation, during a period of two years after the expiry of the employment to employ or try to recruit, entice or solicit any of the company’s employees. The former employees and their new employers requested that the interim measures were overruled on the grounds that the non-solicitation clauses were unreasonable. The Labour Court reviewed the non-solicitation clauses and found that the scope of the prohibition was not restricted to include only key employees or such employees that the former employees had worked with. Further, the clauses were not restricted to apply only in cases of active recruitment by the former employees. In addition, their employments had been terminated more than six months prior to the court trial, which, in the court’s view, meant that the need for protection was lessened. As such, the Court deemed that the company lacked legitimate interest to enforce the post termination restrictions and that the non-solicitation clauses were unreasonable. Consequently, the Court overruled the interim measures in favor of the game programmers and their new employers.