🔹 Introduction

 Non-competition clause is a restriction under which an employee cannot engage in competitive activities against their employer, either during employment or after its termination (if provided for). To be effective, it must be in writing and meet specific conditions.
 

🔸 1. Legal Basis

• Labor Code – Articles 101¹–101⁴
• Civil Code – regarding liability for damages
• Judicial decisions of the Supreme Court – including II PK 123/19 (concerning proportionality and compensation)

🔸 2. When can a non-competition clause be introduced?

✅ a) During the employment contract

 The non-competition clause may relate to:

• conducting competitive activities (company, sole proprietorship),
• working for another competing entity (employment contract, commission, contract).

📌 Example: An employee hired as a sales specialist at company X cannot work for direct competitor Y or start a similar business. 

✅ b) After termination of employment

The non-competition clause after the end of employment applies only to employees who have access to confidential information and its validity requires:

• written agreement,
• specification of the duration of the non-competition,
• payment of compensation (at least 25% of the last monthly salary × number of months of the non-competition).

📌 Example: An employer can require a former IT manager to refrain from working for competitors for 6 months by paying a monthly compensation.
 

🔸 3. How to introduce a non-competition clause?

✅ a) During the contract

• Form: written agreement, most often as a separate document or an annex to the employment contract.
• No compensation payment is required, but violation of the clause may result in disciplinary action or damage claim.

✅ b) After termination of employment

• Requires explicit consent of the parties in writing,
• Mandatory monetary compensation – even if the employee suffers no loss,
• Can be paid as a one-time sum or monthly (recommended practice).

🔸 4. What should the non-competition agreement contain?

Employer and employee data - ✅ Yes
Scope of the ban - ✅ Yes (Clearly specify what constitutes competition)
Duration - ✅ Yes (After employment ends – mandatory)
Compensation amount - ✅ Yes (Min. 25% of salary (Art. 101² § 3 Labor Code))
Method of payment (monthly/one-time) - ✅ Yes (Determining the form secures both parties)
Contractual penalties (optional) - ⚠️ Recommended (It is worth defining in case of breach of the clause)

🔸 5. When does the non-competition clause become invalid?

• After the lapse of the stipulated duration,
• If the employer does not pay compensation (on the employee's side – the agreement ceases to apply),
• If real competition ceases to exist (e.g., liquidation of the company),
• By mutual agreement – the agreement can be terminated earlier (in writing).

🔸 6. Violation of the non-competition clause – consequences

Liability for damages - Obligation to pay compensation promptly
Disciplinary action (if employment continues) - Loss of the right to claim (if no written record)
Possibility of legal claim - Possibility of expiration of the agreement (Art. 101² Labor Code)

📚 Legal Basis 

• Labor Code: Articles 101¹–101⁴
• Supreme Court ruling of September 11, 2003 (I PK 403/02) – validity of compensation
• Supreme Court ruling of April 5, 2012 (II PK 223/11) – form of the non-competition agreement