Problems of Application of Employee’s Duty not to Compete
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Abstract
As there is a gap of legal regulation of covenants not to compete in Lithuania, the legal doctrine and the case-law are analyzed in this article. It is recognized in judicial practice that labour laws are not applicable for the regulation of the covenants not to compete. So, the parties, an employer and employee, are free to make agreement on non-competition.
There are some suggested principles how to make parties’ agreement on non-competition. Firstly, there should be disputed an adequate compensation to the restrictions that would be made for an employee. Secondly, the restriction of competing should be precisely described, taking into account other issues, such as period of non-competing, employee’s qualification and duties, termination of agreement, etc.
It is also proposed to supplement the Law on Competition of the Republic of Lithuania with the rules concerning the conclusion, execution or termination of these covenants.
There are some suggested principles how to make parties’ agreement on non-competition. Firstly, there should be disputed an adequate compensation to the restrictions that would be made for an employee. Secondly, the restriction of competing should be precisely described, taking into account other issues, such as period of non-competing, employee’s qualification and duties, termination of agreement, etc.
It is also proposed to supplement the Law on Competition of the Republic of Lithuania with the rules concerning the conclusion, execution or termination of these covenants.
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Articles
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