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Why concluding a non-compete agreement in Ukraine is not the best way to protect business?

Increasingly, companies are increasingly trying to enter into non-compete agreements (also known as NCAs) with talented employees or with employees who are given access to certain information that the company does not want to tell competitors.

It is clear that the company thus protects its business interests, confidential information or even trade secrets. However, as practice shows, such protection is ineffectivebecause:

The employee's right to work is guaranteed by the Constitution and cannot be restricted.

The application of fines to employees is prohibited.

After dismissal, all the duties of the employee are terminated, so he can not be obliged to do something after the termination of the employment contract.

Legally, such agreements in Ukraine are not regulated by anything, and agreements that restrict the employee's right to work, by default, do not comply with labor law. But this does not mean that it makes no sense to conclude an NCA at all. At a minimum, such an agreement will serve as a psychological stimulus for the employee.
If employees know that the company will not actually be able to prosecute them, then the problems begin. Especially if such an agreement is made from a template found on the Internet.

Therefore, if you really can not do without the conclusion of the NCA, we advise you to follow these basic rules:

Enter into a contract not with an employee, but with an individual. If there is no connection with the employment contract, it will no longer be an employment relationship, but a civil one. Then, accordingly, there will be no violation of the employee's labor rights, which are so carefully protected;

Do not prescribe in the contract of prohibition such as "has no right", "cannot", etc. Indicate what responsibilities a person assumes, for example, to refrain from certain actions;

Apply to such an agreement the law of another country in which such agreements are permitted. The contract may stipulate that it is governed by the law of another country. This can be any country you choose. Only clarify in advance the requirements for such agreements in this country, so that it is not subsequently declared invalid due to the absence of other mandatory conditions;

"Do not punish" a person for violating the terms of the agreement with a fine, but on the contrary indicate that for compliance with the terms of the contract a person is paid a certain amount. And take care to confirm the payment of this amount;

If there is a confidentiality agreement, it is better to interpret the non-compete provisions and include them in this agreement.. So you will have more chances if the case goes to court, because confidential information in Ukraine can be protected in some way.

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