Not To Compete Agreement

Not To Compete Agreement Template for Denmark

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Document background

The Not To Compete Agreement is essential for protecting business interests in competitive industries under Danish jurisdiction. It is typically implemented when employees have access to sensitive information, valuable client relationships, or critical business knowledge. The agreement must strictly comply with the Danish Act on Employment Clauses, which mandates specific compensation requirements and duration limits. This document is particularly crucial for senior positions, technical roles, and sales positions where employees could potentially harm the business by working for competitors. The agreement includes detailed provisions on restricted activities, geographical scope, compensation structure, and enforcement mechanisms, all tailored to meet Danish legal requirements while maintaining reasonable restrictions on employee mobility.

Suggested Sections

1. Parties: Identification of the employer and employee, including full legal names and addresses

2. Background: Context of the agreement, including the employee's position and access to sensitive information

3. Definitions: Key terms used in the agreement, including 'Competitive Business', 'Restricted Territory', and 'Restricted Period'

4. Scope of Non-Compete Obligations: Detailed description of prohibited competitive activities and specific restrictions

5. Duration: Time period of the non-compete obligations (maximum 12 months under Danish law)

6. Geographical Area: Specific definition of the geographical territory where restrictions apply

7. Compensation: Mandatory compensation details as required by Danish law (minimum 40% to 60% of salary)

8. Notification Requirements: Employee's obligations to notify new employment during restricted period

9. Breach and Remedies: Consequences of breach and available legal remedies

10. Governing Law and Jurisdiction: Confirmation of Danish law application and jurisdiction

Optional Sections

1. Customer Non-Solicitation: Additional provisions restricting contact with customers (if applicable to role)

2. Employee Non-Solicitation: Restrictions on soliciting other employees (if relevant to position)

3. Confidentiality Obligations: Additional confidentiality provisions if not covered in main employment agreement

4. Garden Leave: Provisions for garden leave period if applicable

5. Training Compensation: Provisions regarding specialized training costs if relevant

6. Severability: Provisions for partial invalidity while maintaining rest of agreement

7. Review and Modification: Provisions for periodic review or modification of restrictions

Suggested Schedules

1. Schedule 1 - Compensation Calculation: Detailed breakdown of compensation calculation and payment schedule

2. Schedule 2 - Restricted Territory Map: Detailed map or list of geographical areas covered by restrictions

3. Schedule 3 - Competitive Businesses: List of specific competitors or types of businesses considered competitive

4. Appendix A - Employee's Position Details: Details of employee's current role, responsibilities, and access to sensitive information

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