We have recently been asked about the available solutions for companies, from a Romanian legal perspective, to limit unfair competition that could be done by own employees. Specifically, “what can we do to limit the situations in which an employee might choose to provide the same services that the employer provides to customers in the marketplace?”. Sometimes even by competing our prices and servicing the same clients they work for as an employee of our company.
In principle, from a Romanian legal point of view, there are two main solutions that an employer can use in dealing with employees to limit unfair competition behavior on their part.
We detail and explain below how they work and how each of these are regulated in the applicable Romanian legislation:
1. Confidentiality Clause
As a basic rule, the confidentiality clause is effective only for the duration of the individual employment contract. However, regarding the length of time in which this confidentiality clause must be observed after the termination of the contract, the Romanian Labor Code does not specify a specific deadline, as clearly provided in the case of the non-competition clause (details below on non-competition clause).
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