For years there has been much discussion in the Netherlands about the non-compete clause, which also includes the non-solicitation clause. These clauses were often included in employment contracts, restricting employees’ freedom of choice in employment, even when the employer had no real interest in such clauses.

After a similar proposal was shelved a few years ago, a new proposal is now open for online consultation. In the diagram below, we have clarified the differences between the current and proposed situations. If the proposal is adopted, all new non-compete clauses in the Netherlands must meet stricter requirements.

At the moment, (former) employers and employees often find themselves in a deadlock when discussing a non-compete clause because it’s unclear whether the court will enforce the clause against the employee. We welcome the legislative change: on the one hand, companies will be more willing to pay for the enforcement of the non-compete clause if they genuinely have an interest in it; on the other hand, employees won’t be unnecessarily bound by the clause. And in case they are, at least they will receive compensation as a remedy.