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What is a non-compete clause?

Verified 07 May 2021 - Directorate for Legal and Administrative Information (Prime Minister)

The non-compete clause is a clause inserted in the employment contract. It is intended to limit the freedom of an employee to perform, after the termination of his contract, equivalent functions with a competitor or on his own account. To be valid, the clause must meet certain criteria.

The non-compete clause is not defined by law, but has been clarified by court decisions, i.e. byCase law.

In order to be applicable, the non-compete clause must satisfy certain defined cumulative criteria which determine its validity.

The clause must be written in the employment contract (or provided for in the collective agreement).

The clause is applicable only if it ensures the protection of the company's interests (for example, when the employee is in direct contact with customers).

It must not prevent the employee from finding a job elsewhere.

The non-compete clause shall apply to:

  • Over time (its duration should not be excessive)
  • In space (a geographical area must be provided)
  • To a specifically targeted activity (e.g. hairdresser)
  • If a financial contribution is foreseen

The financial compensation (or compensation) is paid by the employer to the employee who undertakes not to compete with his former employer at the end of his employment contract.

If the employee no longer complies with the clause, the employer may interrupt the payment of the consideration.

If one of these criteria is not met, the non-compete clause is invalid and entitles the holder to payment of damages to the employee.


The non-compete clause shall apply to:

  • on the actual date of termination of the contract (at the end of the period of notice)
  • or on departure of the employee (in the case of waiver of notice)

The financial contribution is due if the non-competition clause is applicable (even if the employee is dismissed for serious misconduct or if he resigns).

This consideration may take the form of

  • or capital
  • or an annuity (i.e. a premium paid in one installment or periodically)

It must be paid after the termination of the contract of employment, not during its performance.

The consideration must be reasonable: derisory consideration amounts to no financial consideration and is therefore not valid.

Waiver by employer

The employer may waive the application of the non-compete clause:

  • under any conditions laid down in the contract or in a collective agreement
  • or with the agreement of the employee if nothing is provided for in the contract of employment or the collective agreement

The waiver must be clear and not subject to interpretation by the employer or employee. In addition, it must be notified to the employee by registered letter with acknowledgement of receipt.


the employer is required to comply with the conditions of the waiver provided for in the contract of employment or treaty provisions if they exist.

Non-compliance with the employee's act

Failure by the employee to comply with a non-competition clause shall result in the payment of the compensatory allowance being canceled.

In addition, the judge may order the employee to pay damages.

Non-compliance with the employer's act

If the employer does not pay the compensation due to the employee, the latter is no longer obliged to comply with the non-competition clause.

The judge may order the employer to pay damages in compensation for the loss suffered by the employee. The employer remains obliged to pay the compensatory allowance for the period during which the employee has complied with the provisions of the non-competition clause.