Analysing Ethics and Legal Enforceability in Employee Noncompete Agreements in EU Legislation

Enik Pogace, Head of Employee Relations Division , Bank of Albania

Noncompete agreements are recently being used in a range of businesses. From engineering firms to companies and businesses of all sorts are pushing new hires to sign noncompete agreements that legally restrict them from working for other potential competitors. The proposed paper would attempt to argue that although putting employment restrictions on an executive or entrepreneur, who is likely to know sensitive trade secrets, from competing against a former employer is probably necessary, putting ordinary employees under such burden may restrict their employability if they leave their employer. The argument would take as a basis the EU legislation in the field, taking also into account that noncompete agreements are the most stringent legal barrier that restricts an employee’s right to practice his or her profession. The analysis would include also the legal standing of the use of alternative agreements, namely confidentiality agreements or nonsolicitation agreements, with a view to present a comparative analysis. The paper would strive to answer numerous questions in light of the recent conditions set forth by the pandemic, including among others: What is the purpose of a noncompete agreement? Is it ethical for a company to require its employees to sign a noncompete agreement as a condition of employment? Under what conditions can be considered to be acceptable for an employer to ask an employee to sign a noncompete agreement? What are alternative ways to manage employee behaviour, so they do not harm their former employer after they quit?