Can I Legally Join a Competitor Despite My Contract's Restrictions in India?

I'm employed as a Senior Manager in a Research firm in India, and my employment contract stipulates I cannot join a competitor for a certain period.

Issues:

1. Is this clause legally enforceable? If yes, under what circumstances?

2. The company did not give me any training. On the other hand, it's my skills that gave my department a sound footing in its domain and had a great impact on sales. Since no skills were imparted by the company to me for discharging my duties, it's my intrinsic skill, and it's my prerogative to whom I offer it. Will this logic stand valid under Indian laws—labor, civil, or criminal?

3. If I seriously want to join a competitor, what are the legal options? I would appreciate some help on this.

Thanks in advance.

Going by the tone and tenor of your posting, I get a feeling that you either are working or have worked abroad. If yes, I guess you must have been already exposed to something called a "Non-compete Agreement," especially for senior management executives. This is now becoming prevalent in India too, given that the IPR regime is becoming more common.

To the extent I know, this is legally tenable and enforceable—as long as the timeframe is clearly specified and the terms are equally applicable on BOTH sides (Employer and Employee). I suggest waiting for other members to respond too.

However, I am not sure of your point regarding training—how is this related to your main issue? Please note that you are not referring to any Service Bond—which is linked to any training/skills imparted or not.

Non-Compete is linked more to the trade secrets and company-confidential info that the employee is expected to be exposed to during the tenure of employment, which if shared with competitors could/would be detrimental to this company's interests.

And just as you brought some skills to this company from earlier employment(s), so too would this company expect you to carry additional skills when you leave...hence the effort to protect their interests. Also, in the current global scenario, "Skills" are becoming more intellectual—could be problem-solving skills, skills leading to new product development, soft skills, etc.—than some sort of specific training.

Hope you get the point.

Regards, TS

Industry Challenges with Non-Compete Clauses

Endless discussion! I remember an instance when an employee came to me with the same query. For him, the issue was that if his experience and skills are specific to that domain, it is for sure that he would join a company in the same domain only!

This has been a common issue in the industry, especially in IT. The IT sector involves a lot of tricks of the trade, secretarial formulae, confidential data, and the same set of customer base. In this fast-moving economy, it is difficult to survive if the same is misused at a competitor's place. For securing its interest, any company would not want its employee to join a direct competitor.

But from your query, I too was not able to judge the reason for you to mention the training or skills not gained from your current employer. Being a Senior Manager, it is quite obvious that your contribution is expected - you are paid for that. But while being an employee, you would have come across several things which can be termed as CONFIDENTIAL. That is where the clause comes into place.