Troublesome contract clauses in the employment agreement

Camelia Bucioveanu, 18 Mar 2009

Romanian version

Under the provisions of Labor Code in force, the content of the employment contract can include four specific clauses: confidentiality, non-competition, professional development and mobility.

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Employee can pay damage to companies

The non-compete clause generally appears in finance, banks, IT&C or telecom industry.

It is usually contained in department managers’ contracts, top managers or in case of employees in key-positions. When an employee has agreed to include such a clause in their employment contract and resigns, the employers usually pay several salaries to stimulate the employee to remain or not to leave immediately after to a competitor, Vilceanu noted. This type of financial compensation may or may not be stipulated in the employment contract.

The employee’s obligation to his former employee in case of a breach of non-compete clause contained in the contract is to return the indemnity and the payment of damage, in case of a court decision in favor of the employer.

However, one of abusive clauses, and yet often practiced, refers to the company’s request to be informed on any job offer the employee receives from a competitor. In case an employee in top management receives a job offer from a competitor, and decides to honor it, the damages he or his new employer would be liable to pay can vary between 10,000 and 100,000 euros, said Petra Votiski, country manager of Human Value International executive search company.

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