Invalidity of non-competition clause in employment law

AuthorAlina Rotaru
PhD student Alina ROTARU
The need to introduce some special clauses in a separa te main contract appea red from the need of
employers to ensure the favourable conditions and prospects of car rying out economic activities with some rivals on
a competitive market, where staff fluctuations are frequent and the economic a gents appear and disappear with a
relatively high frequency. In the following article we want to answer some questions r elated to the validity of non-
competition clause, the causes leading to the invalidity of the non-competition clause, in what situation it is
necessary or not to insert such a cla use, stretching in time and in space of the non-competition clause.
Key words: non-competition clause, competitive mar ket, validity of clause, a busive practices, relative invalidity,
absolute invalidity.
JEL Classification: K31
In terms of a functional market economy, as it is the case with Romania, the special non-
competition clause appears to be on the foreground between the clauses of the individual
employment contract, through its significance and frequency. In the initial regulation of the
Labour Code, art. 2-24 of the Law no. 53/2003, the non-competition clause forces the employee
that, during the execution of the employment contract and only in exceptional cases, after its
termination, not to perform in his/her own interest or of a third party an activity that is in
competition with the activity carried out by his/her employer, not to perform an activity for a
third party that is a competitor of his/her employer.
The admissibility of non-competition clause in the individual employment contract
represented along time a discussed and analyzed subject. Although the whole legal literature
agrees about the usefulness of such clauses, the Romanian law on the matter, a mixture of
provisions adopted in profoundly different periods, allows the doctrinaire a little freedom of
In the o pinion of a Romanian author “through the competition clause ... there is not
diminished a fundamental right, but there is established its exercise framework
”. Such
constitutional provisions concerning the obligation of each citizen to exercise his/her rights in
good faith, in compliance with the principle of proportionality between restriction and the
situation that determined this limitation.
According to article 21 paragraph 1 of the Labour code „the clause must be expressly
stipulated in individual employment contract” either upon the conclusion or during its execution.
Inserting this clause in the individual employment contract is not mandatory, the
employer and the employee will decide if they will conclude or not this agreement.
Given that the employer is interested in ensuring conditions and prospects favourable to
the carrying out of its economic activity, it may resort to traditional methods of amiable,
transactional settlement with a specific competitor or to the achievement of some independent
conventions, in the form of special clauses inserted in a main distinct contract.
By the insertion of the non-competition clause it is intended to remove abusive practices,
to avoid competitive situations between the former employee and the employer.
Alina Rotaru, Bucharest University of Economic Studies,
Raluca Dimitriu, Duty of loyalty in employment relationships, Tribuna Economic Publishing House, page 91
Alexandru iclea, Non-competition clause in the individual employment contract, Journal of Commercial Law, no 7-8/1999

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