Netherlands: Recent Judgment on a Non-Competition Clause after Employment of only 11 Working Days
The employee had been employed by the employer in the position of Sales Manager since 1 May 2021. The employment contract contained confidentiality, competition, relationship and penalty clauses. On 18 May 2021, the employee informed the employer that he was terminating the employment contract following an offer from X, a direct competitor of the employer. By letter dated 20 May 2021, the employer expressed its disappointment with the employee’s termination and called on him to comply with the terms of the employment contract, including the non-competition clause.
In summary proceedings, the employer demands that the employee will be ordered to cease and desist from breaching the confidentiality, non-competition and relation clauses. In the counterclaim, the employee claimed, inter alia, the suspension of the non-competition clause and the restriction of the non-solicitation clause.
Judgment of the Cantonal Court
The judge considers the employer has not given the employee a specific reason to give early notice; the employee decided himself to work for a competitor. In addition, when the employee terminated his employment contract, he knew that the company he wants to work for is a major competitor in the market. Therefore, in the opinion of the Cantonal Court, the employee should first discuss the proposal that had been put to him by the competitor, with his current employer. He did not do so. The employer was, thus, faced with a fait accompli and the employee took the risk of being bound by the aforementioned terms of the employment contract.
The Court concluded that the short duration of the employment of eleven working days does not mean that the terms of the employment contract no longer have any effect, or that the employer would have no interest in enforcing the non-competition clause. The employee is an experienced salesman, he was able to quickly form a picture of the organization and, for example, the price structure with the employer during those eleven working days. The employee was immediately involved in the organization at full management level. According to the Court, the knowledge the employee gained during those 11 days gives the competitor an unfair advantage over the employer. Further to that and the balancing of interests of both parties, the Court finds that the employer has a legitimate interest in enforcing the confidentiality clause, the non-competition clause and the non-solicitation clause. However, the short duration of the employment with the employer does give cause to moderate the duration of the clauses to nine months. A penalty payment is attached to the court’s order. The claims of the employee are rejected.
Court of Overijssel 20 July 2021, ECLI:NL: RBOVE:2021:3156 (date of publication: 10 August 2021)