Non-Compete clause bars employees from competing with the business of the former employer during the term of the employment, as well as post termination of the employment agreement. The non-compete clause is a relatively common to employment agreements with key employees, directors and promoters. Non-Solicitation clause prohibits the employees from persuading the former employer’s customers, workforce, third parties like agents or suppliers etc from terminating their relationship with the employer and join the former employee. Below are the frequently asked question on non compete and non solicit clauses and their impact on employee agreements in India. 1. Whether a non-compete clause is enforceable against an employee in India as a matter of law. 1.1 Pursuant to the provisions of the Indian Contract Act, 1872, the law governing commercial agreements and transactions, agreements wherein any restraint or limitation is imposed, which restricts either...
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