A post in IT has entered into a non-compete clause with an employee. But there is also such a thing as an obstacle ban. When does what apply? This is explained by Hendarin Mouselli (VRF Advocaten) on the basis of a recent court decision.
Recently, the High Court of Rotterdam made an interesting decision on the scope of the prohibition of obstacles from Article 9a Waadi. The key question is whether a legally valid non-compete clause had been agreed between the formal employer (posting in ICT) and the worker, taking into account the prohibition of obstacles. A non-compete clause had been agreed between the parties. It provided that for a period of one year after the termination of the employment with the employer, the employee may not perform any work in the service of or for the benefit of the employer’s clients, unless the said clients do not fall within the scope of Waadi. The employee was also not allowed to establish a competing company and / or work there in any way for a period of two years after the termination of the employment contract with the employer. Violation of these prohibitions will, of course, be punished by a fine. The employee has set up his own company together with a colleague. They provide the same IT services as the (former) employer and also make employees available to customers. The employee subsequently terminated his employment contract with the employer. The employer takes the position that the employee has set up a company that competes with it with the intention of posting third parties in addition to itself. The latter the employee has actually done because he has posted himself and a colleague from his own company to third parties after termination of employment.
In short, the prohibition of obstacles means that a formal employer who makes a worker available to a third party to perform work under his supervision and management must not impede the conclusion of an employment contract or an employment relationship with the tenant after the resignation. . . If agreements are made between the employer and the employee that violate the prohibition on restrictions, these agreements are invalid (in other words, a red line can be drawn through them). It is important with regard to the prohibition of obstacles that it should relate to posting, which means: i) the workforce must be paid, ii) made available to third parties, iii) perform work under the supervision and management of this third party. Only if these requirements are met does the prohibition against obstruction apply.
The judgment of the High Court
The non-compete clause was not considered by the High Court to be in breach of the prohibition on obstacles. This is because it appears from the clause that the non-compete clause only applies to the extent to the employer and companies for which the (prohibited) activities are performed by the employee does not falls within the scope of Waadi. Article 9a Waadi cannot be interpreted so broadly that the prohibition on barriers also covers all clients to whom an employee could possibly have been seconded. It is also interesting that the High Court finds that Waadi does not prohibit employers from preventing employees from joining a competing posting company. This gives perspective to the practice, of which more below. This also applies if (former) employees set up such a company themselves. The prohibition on obstruction does not go so far as to prevent the posted worker from setting up a competing undertaking and subsequently carrying out work for or through that undertaking. Nor if it would be with the same tenant through whom the labor was made available. Contrary to what the High Court considers, the latter can, in my view, be viewed differently. The purpose of the Temporary Agency Directive – where the ban on barriers comes from – is to continue to promote permanent employment in the user company. The above led to the ratification of the non-compete agreement agreed between the parties. The former employee had admittedly violated the clause, but it all went smoothly (moderate fine of € 2,000).
Lessons for practice
This judgment teaches us that the prohibition of obstacles is not always ‘femme fatale’ for a non-compete clause. You must not prevent the employee from entering directly into the tenant’s employment or entering into an employment relationship with the tenant. As a temp or posting agency, however, you can prevent the employee from performing work or providing services to (same) tenants through a competitor or through your own company.
The question, however, is whether non-compete clauses still fit into the current spirit of the times and generations. This applies to employment law matters as well as to clients who only too willingly include non-compete clauses in agreements with the self-employed. Let’s be honest. To bind people to a non-compete clause is actually to complain about the strength of the competition, which in reality often involves a lack of own ideas. Recently, I had a lawsuit in which a number of young engineers wanted to move to one of my clients because they no longer feel at home with the now former employer. The former employer wanted to keep them there for fear of setting a precedent and that more employees would follow because they were so invested in them. I said to the former employer, ask yourself why people go and do something about it. Assume your own strength. Do exciting things ‘between the employment law sheets’ to bind people to you. Another example from my own practice involved a client who kept a self-employed person to the non-compete clause, but who was nevertheless confronted by the judge. After the verdict, the client instilled fear in other self-employed people for several weeks because it was only a single case. In the end, this company also saw the light and apologized to the self-employed. The message was ‘we’m sorry we did it wrong and should have done it differently’. It did not stop there. If your ‘store’ is empty and there is a threat of a mass claim due to hidden employment contracts, then what should you do? Let everyone know that they are no longer bound by the non-compete clause. I can understand that an entrepreneur – whether on the advice of his advisory board – has come to new insights. Too bad it required a lawsuit. Well, better late than never.
At the same time, an employer who has invested in compulsory employee training may need to agree on a non-compete clause from 1 August 2022. Due to the arrival of the new training scheme per. After 1 August, the costs of the compulsory education can not be reimbursed from a retiring employee. After all, it could be a reason to agree on a non-compete clause. But again, if you know how to tie and captivate employees, then you have earned all that training back. It’s called good entrepreneurship.
This is a contribution from Hendarin Mouselli (VRF Advocaten) for Flexmarkt.
also read: When is a confidentiality and / or non-compete clause appropriate?
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