Non-Compete Clauses: How Can Senior Managers Navigate Career Restrictions?

One great Indian lawyer made an employee handbook for our multinational company, where I am working now.

"The employees of the company shall not, during the term of their employment and for a period of 3 years thereafter, take up employment with any company which is in competition with the company. This shall include taking up employment in any capacity including, without restriction, as a consultant or advisor."

Many of my friends suffer from the above condition at the senior management level, as this has screwed up their future career or forced them to go into early retirement. How should one handle such a situation? Of course, I am also an employee, and in the future, I may also look for good opportunities.

I appreciate any good suggestions in this regard.

Hi,

What a stupid set of guidelines and conditions of employment. I have never encountered such in my entire career. Well, these conditions are null and void and can be challenged in any court. Your employees have a choice whether to accept the conditions or not. I believe they should boycott against such rules.

Warm regards, Umesh Chaudhary (welcomeumesh@yahoo.com)

Hi,

In my country, Croatia, the law allows for the possibility to restrict employment competition for a maximum of 2 years. However, in that case, the employer is required to pay at least 1/3rd of the employee's monthly salary per month during that period. Personally, I have not heard of such a case, possibly because it is expensive for employers to do so. As an employer, I can only do whatever I can to retain good employees for as long as possible. I am confident that in your country, this issue could be resolved in an appropriate manner, leading to a win-win situation for everyone.

Good luck, Ivana

Hi Ivana,

India is the fastest developing country in the world, which has achieved development in just 60 years. The most important aspect of this growth has been the academics. The people are very knowledgeable and sharp-minded.

As a result, some individuals choose to create rules that violate the country's laws but have an impact on the employees' skills. However, in a country like India, where the interviewee is as smart as the interviewer, such rules are hardly accepted. Moreover, if they are accepted initially, they can also be challenged.

Warm regards,
Umesh Chaudhary
welcomeumesh@yahoo.com

Dear Friends,

Thanks a lot for your reply letters. I discussed with many Indian friends; they were also shocked to hear about this rule made by an Indian lawyer who is a consultant for many multinational companies in Chennai. This rule is followed by many Singapore companies.

I also bet that IT HRD managers in India are very familiar with this rule but are unable to answer. Why not, gentlemen? Please open your minds.

The rule is as follows, I have just typed what is written in the employment rule:

Non-Solicit and Non-compete:

"The employees of the company shall not, during the term of their employment, and for a period of three (3) years thereafter, either directly or indirectly, solicit offers of employment from other companies or entice or encourage employees of the company to leave the employment of the company.

The employees of the company shall not, during the term of their employment, and for a period of three (3) years thereafter, take up employment with any company that is in competition with the company. This shall include taking up employment in any capacity without restriction, as a consultant or advisor."

Indeed, my parent company has no such rule in its USA, UK, Japan, Germany branches. This elite Indian lawyer is providing a way for how to constrain Indians in India. We are going to open a branch office soon in India; hence, please guide me on how to get rid of this rule. The lawyer is appointed by my boss, who is the ultimate authority, recommended by his friend in India.

Please advise me on how to protect a young professional from ruining his career in case he is not satisfied with his job for some reasons in the future. This situation could also affect "you" if you join our multinational company.

Now, I understand how the British had established a strong presence in Chennai long ago.

Regards,

Muru