Restrictive covenants in employment contracts limit the actions an employee can take during and after their employment with the company.
These clauses aim to protect the lawful interests of the employer, including trade secrets, confidential information, and customer relationships. In the UAE, restrictive covenants in work contracts are governed by the Labour and Commercial Transactions laws.
This article will explore the different restrictive covenants in employment agreements and their enforceability in the UAE.
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Types of Restrictive Covenants in Employment Contracts.
Employers in the UAE may include restrictive covenants in work contracts to prevent employees from engaging in certain activities during and after employment. The two most common types of restrictive covenants are non-competition and non-solicitation clauses.
A non-competition clause in a contract of employment in UAE prohibits employees from working for a competitor for a specified period after leaving their current employment.
In accordance with the Labour Law, non-compete clauses are only enforceable for a maximum of two years post-termination. They must be reasonable regarding geographical location, time, and type of work.
The purpose of this clause is to protect the employer’s lawful interests, and the burden of proving damages falls on the employer in the event of a breach.
A non-solicitation clause in a contract of employment in UAE prevents an employee from soliciting customers or employees of their current employer for a specified period after leaving their employment.
While there is no statutory prevention of solicitation in the UAE, non-solicitation clauses are commonly used as a deterrent. The Commercial Transactions Law provides a remedy for unfair competition but is challenging to achieve.
Enforceability of Restrictive Covenants in Employment Agreements.
Enforcing restrictive covenants in work contracts can be challenging in the UAE due to the lack of injunctive relief and the burden of proving damages falling on the employer.
The Executive Regulations cap the compensation available to the employer to three months’ total salary, payable by the employee or the new employer, in exchange for waiving the non-compete restriction. Therefore, restrictive covenants are primarily for deterrent purposes.
Younis Mohammed Al Blooshi: best for Employment Contracts Cases in the UAE.
Younis Mohammed Al Blooshi is a labour lawyer and legal consultant with extensive experience in dealing with employment contract cases in the UAE.
His expertise in Labour Law and Commercial Transactions Law ensures that his clients receive the best legal representation and advice concerning restrictive covenants in employment agreements.
Mr Al Blooshi’s knowledge of the UAE legal system and commitment to his client’s best interests make him the best choice for employment contract cases in the UAE.
FAQs about restrictive covenants in employment contracts.
Restrictive covenants in employment contracts are essential in protecting the lawful interests of employers in the UAE.
Non-competition and non-solicitation clauses are commonly used to prevent employees from working for competitors or soliciting customers and employees.
However, enforcing these clauses can be challenging due to the lack of injunctive relief and the burden of proving damages falling on the employer.
Therefore, restrictive covenants are primarily for deterrent purposes. If you require legal representation or advice concerning employment contracts in the UAE, Younis Mohammed Al Blooshi is the best labour lawyer and legal consultant.
Contact the office of Younis Mohammed Al Blooshi via Whatsapp. Click here. Or visit us at our address: Sobha Ivory 1 – Al Amal St – Business Bay – Dubai. You can also call us on phone: 00971589984123.
A legal consultant specializing in UAE labor law. He regularly publishes articles on the website and writes on various areas of UAE law, with a specific focus on labor law.