What are the key types of restrictive covenants in your jurisdiction?
The key types of restrictive covenants are the non-compete clause, the non-solicitation of clients clause and the non-solicitation of personnel clause.
Does the employer have to pay compensation to the employee in relation to the restrictive covenants?
No compensation is due for the non-solicitation of personnel clause. But a compensation is due for the non-solicitation of clients and non-compete clauses (usually both constraints are included in one clause, so that one compensation is granted for both in case of implementation of the covenant). The compensation is mentioned in the employment contract, and determined depending on the level of constraints: duration of the clause and geographical scope. The compensation is usually 25 to 50% of the monthly salary, to be paid each month during the implementation of the non-compete clause. The Collective Bargaining Agreement must also be checked in this respect.
Are there limits to the post-employment restriction period and to the geographical area of the restrictive covenants?
The non-solicitation of personnel clause is limited in time, usually 6 to 24 months.
The non-solicitation of clients and non-compete clause must be limited in time and in geographic area. The time limit is usually 6 to 24 months, it being specified that the longer the clause, the higher the remuneration is. The Collective Bargaining Agreement must be checked in this respect.
From a geographic scope perspective, the clause must be limited to local parts of France or France (plus, exceptionally when the company's interests dictate it, another country, although it is more and more challenged by the courts). The Collective Bargaining Agreement again must also be checked in this respect.
Can the employer unilaterally revoke the agreed restrictive covenant at the end of the contract or otherwise avoid its application?
Yes, the non-solicitation of clients and non-compete clause can be unilaterally waived by the employer. The waiver possibility must be indicated in the employment contract. The waiver can take place within a limited period of time following the notification of the employment redundancy or termination of the contract (usually 15 days). However, according to case law, in case of release from notice at the employer's initiative, the waiver must be notified at the latest simultaneously to the release from notice.
The Collective Bargaining Agreement must be checked in this respect.
What remedies are available to the employer when an employee breaches their restrictions?
If the employee breaches the non-solicitation of personnel clause, the employer can claim for damages from the employee.
If the employee breaches the non-solicitation of clients and non-compete clause, the employer stops paying the non-compete indemnity. The indemnity already granted must be reimbursed. Damages can be claimed to compensate the prejudice suffered, which may come on top of a lump-sum contractual indemnity equal to the remuneration of 3 to 6 months of salary.
