Definition and Types of Restrictive Covenants
Employees must respect the provisions on intellectual property, confidentiality and non-competition related to the employer during the employment relationship. There are no specific laws on restrictive covenants after the termination of employment. Nevertheless, the Constitution establishes freedom of work, which means that the employee can challenge any restrictive covenants after termination of employment. However, the doctrine understands that restrictive covenants are entirely applicable as long as they are limited in time, geographic scope, clients and activity, products and services, and if compensation is paid in exchange.
Types of Restrictive Covenants
- Non-Compete Clauses
Non-compete, non-solicitation of clients and non-solicitation of employees are clear examples of restrictive pacts.
- Non-solicitation of customers
There is no rule in Dominican labour law regarding the provisions of non-solicitation of clients. However, it is widespread for Dominican employers to address this restriction in employee-management contracts. This type of regulation is rarely enforced by labour courts, which means few decisions on its applicability exist.
In effect, no jurisprudence in the Dominican Republic establishes existing restrictions on an employer’s ability to impose agreements not to compete, or agreements not to solicit clients or employees. However, the Dominican Republic generally follows the prevailing opinions of the jurisprudence and doctrines recognised in other Latin American countries. In general, restrictions are permissible as long as they are reasonable.
- Non-solicitation of employees
In the Dominican Republic, the use of non-solicitation employee covenants is unusual. In our opinion, it is inapplicable due to the employee’s constitutional right to freedom of work.