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Non Compete Agreement in Spanish

The post-contractual non-competition obligation is a clause which, although initially atypical and little known, becomes indispensable for certain jobs in order to obtain, inter alia, the know-how, training, experience, etc. acquired by a worker in the provision of his services to a company. The post-contractual non-competition obligation is legally effective in Spain and should not be underestimated by the employer or employee. Such an agreement may be concluded at any time during the duration of the employment relationship without the employee or employer being able to withdraw unilaterally. In the event that compliance with this clause is at the discretion of either party, the Contract shall be deemed void. First, this agreement is set out in art. 21 of the Spanish Workers` Statute and, in order to include it in the contractual relationship, the parties, in particular the undertaking, must take account of certain requirements in order to prevent a court from annulling the agreement. The Workers` Statute does not specify the amount or form of compensation, which means that, in principle, it can be anything that the parties agree to in the contract. Despite this, case law has considered several formulas, such as: If an employer does not respect his obligations, the employee must obtain a court decision that exempts the employee from his obligations. This does not prevent the employee from also demanding payment of the agreed amount.

If the employee does not comply with the request, the employer must prove the violation and refer to the employee performing any of the activities expressly prohibited in the contract itself. There is nothing to prevent the “introduction of a penalty clause”, which consists of the reimbursement of what has been paid, including the payment of damages. If no penalty clause is established, the usual consequence is the order of a court to reimburse the sums paid by the employer in proportion to the time not completed […].