When signing a non-compete agreement, some workers thought that "going through a process" was "useless".
As everyone knows, there is a risk of default
When the old business is re-employed, the worker is sentenced to triple compensation!
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In the eyes of some employers, as long as employees sign a non-compete agreement, they can rest easy, and it is best to sign them all; And some workers also held the attitude of "going through a process" and "it is useless", and signed in confusion, but they did not know that these agreements had legal effect. When workers are re-employed, disputes arising from non-compete agreements are increasing.
The lawyer said that more detailed provisions should be made on the scope of personnel to whom the non-compete restriction applies, the scope of liquidated damages, and the definition of competitive relationships, so that it can not only protect the intellectual property rights and trade secrets of the employer, but also protect the labor rights of employees and the reasonable flow of talents.
Non-compete agreements are the "secret magic weapon" of enterprises, but they have also become the "shackles of career selection" for signed employees. Recently, Ma Moulin and Liu Mousheng, who had signed a non-compete agreement for the second time, went to court with their old employer, and after two trials, the court finally ruled that the two violated the agreement and had to pay triple compensation.
"It was obviously an ordinary position, but in the end it became a non-compete restriction personnel." Facing the final result of the trial, Ma Moulin and Liu Mousheng felt a little incredible. However, in reality, many workers, like them, have signed non-compete agreements at will, holding the fluke mentality of "going through a process" and "useless", which not only limits the scope of re-employment, but also has the risk of default.
The employee was sentenced to liquidated damages for choosing a new job
In May 2019, an energy company in Xinjiang signed a non-compete agreement with its employees, stipulating that during the term of the labor contract or within 5 years after the termination or termination of the labor contract, the employee will not be employed or provide services from other employers and their affiliates that compete with the company that produce or operate similar products or engage in similar businesses. Moreover, after the employee fulfills the non-compete agreement, if the labor relationship is terminated, he is entitled to non-compete compensation, which is one-third of the employee's total salary in the 2 months before leaving the employer, and is assessed on a monthly basis for a period not exceeding 12 months.
According to Article 24 of the Labor Contract Law of the People's Republic of China, "the personnel subject to non-compete restrictions are limited to the employer's senior management, senior technical personnel and other personnel with confidentiality obligations". With the mentality that "I am not in the core position, I have no access to trade secrets, and I can still get compensation after resignation", Ma Moulin, who is engaged in the external operation of industrial three wastes, and Liu Mousheng, an ordinary technician, signed the letter.
After that, the two left the energy company one after another, but when they re-chose their jobs, the two found that the compensation of the non-compete agreement was not enough to make up for the economic losses caused by the restrictions on employment, and under the pressure of survival, Ma Moulin and Liu Mousheng still chose a job that matched their work experience and skills. However, the "old employer" energy company applied to the Xinjiang Uygur Autonomous Region Labor and Personnel Dispute Arbitration Commission for labor arbitration on the grounds that the new unit where the two joined had similar business with themselves, and finally ruled that "Ma Moulin and Liu Mousheng paid liquidated damages for violating the non-compete agreement, returned the non-compete compensation paid by the company, and continued to perform the non-compete obligation".
The two were dissatisfied with the ruling and went to court with the energy company. In one case and two trials, the court held that, firstly, during the period of employment in the original unit, Ma Moulin had been working in the raw material workshop, was familiar with the production process of the product, and belonged to "other personnel with confidentiality obligations"; Liu Mousheng is a process engineer and has participated in a number of scientific and technological project innovations, and belongs to the "non-compete restricted person", and both parties are non-compete restricted personnel; Secondly, Ma Moulin and Liu Mousheng should be responsible for their signature behavior, and after their resignation, they received monthly compensation from the company, which means that they were aware of the confidentiality and non-compete obligations they should perform after resignation, but they still joined the company that had a competitive or affiliated relationship with the original unit, which violated the relevant provisions of the non-compete agreement; Finally, the two parties agreed that the compensation would be 12 times the employee's total salary in the <> months before leaving the company, but this agreement obviously belonged to the employer's restriction of the employee's employment rights with a lower non-compete compensation standard and heavier liability for breach of contract, which was unfair to the employee. Therefore, it was determined that the liquidated damages to be paid by Ma Moulin and Liu Mousheng were three times the total amount of non-compete compensation between the parties, and they continued to perform the agreed non-compete clause.
Sign agreements to sink to junior employees or even interns
Initially, non-compete agreements were designed to help companies restrain executives or key technical personnel, prevent competitors from "digging into the wall," and protect trade secrets. As stipulated in the Labor Law, "the personnel subject to non-compete restrictions are limited to the employer's senior management, senior technical personnel and other personnel with confidentiality obligations".
But now, non-compete agreements are being abused, not only in management, but also in junior employees and even interns. The reporter of "Workers' Daily" noticed that on the online social platform, many netizens have the same experience as Ma Moulin, and their original positions include sales personnel, financial personnel, full-time teachers, etc.
In fact, some companies require non-compete agreements when employees are onboarded. Previously, Yaoyao submitted her resume to an educational institution and successfully interviewed, and when signing the contract, the non-compete agreement brought out by the institution made her ask, "I am here to apply for an ordinary teacher position, why do I have to sign a non-compete agreement?" The other party said, "You have to sign for entry, and the impact is not great."
In the eyes of some employers, as long as employees sign a non-compete agreement, they can rest easy, and it is best to sign them all; And some workers also held the attitude of "going through a process" and "it is useless", and signed in confusion, but they did not know that these agreements had legal effect.
Cannot be "casual signing" and "compulsory signing"
Can a non-compete agreement be "signed casually"? Industry experts said: "Of course not. "For employers, they can sign non-compete agreements with relevant employees according to the protection needs of trade secrets or intellectual property-related confidentiality matters, rather than with any employee; For employees, the signing of non-compete agreements is limited to senior management, senior technical personnel and other personnel with confidentiality obligations, among which, for other personnel with confidentiality obligations, they are not generalized based on the level of their positions, but based on their actual position and whether they can access trade secrets, if the position belongs to sensitive positions such as technology research and development, sales, finance, etc., and has the convenience of accessing the employer's technical secrets or business secrets, they can become the subject of the signing of the non-compete agreement.
Wu Yunfu, a lawyer at Fujian Tianheng United Law Firm, believes that if the employee is not a senior manager, senior technical personnel and other personnel with confidentiality obligations, he has the right not to sign a non-compete agreement. If it is the above-mentioned personnel, the employee shall perform his obligations according to the agreement after signing the non-compete agreement, otherwise, he shall pay liquidated damages to the original employer. If the liquidated damages stipulated by the employer in the non-compete clause are excessively higher than the actual losses, the employee may apply to the people's court to adjust the amount of liquidated damages.
Lawyer Wu Yunfu said that at present, the provisions of laws and judicial interpretations on the applicable personnel of non-compete restrictions are relatively general, especially the scope of identification of "persons with confidentiality obligations" is not clear enough, resulting in employers abusing non-compete agreements to impose non-compete restrictions on ordinary employees with lower compensation. The laws and regulations do not stipulate a maximum limit on the amount of liquidated damages paid by employees, and the scale of determining "competitive relationship" is not uniform enough, and once employees violate the non-compete agreement, they often have to bear an unbearable huge amount of liquidated damages. It is proposed to introduce more detailed regulations, so that it can not only protect the intellectual property rights and trade secrets of employers, but also protect the labor rights of workers and the reasonable flow of talents.
Reporter Wu Duosi Correspondent Ma Annie "Workers' Daily" (2023-05-26 Version 06)