A non-compete clause is a common provision found in employment contracts around the world, including in the United Arab Emirates (UAE). It is a legal agreement between an employer and an employee that prohibits the employee from engaging in activities that compete with the employer`s business interests for a certain period after the termination of their employment.
In the UAE, non-compete clauses are considered enforceable as long as they meet certain conditions. First, the clause must be reasonable in terms of the geographic scope, duration, and type of the prohibited activity. The UAE courts will not uphold a non-compete clause that is too broad or unreasonable.
Second, the clause must be in writing and signed by both parties. It is important that the employee receives a copy of the agreement before signing it.
Third, the employee must receive consideration for agreeing to the non-compete clause. This consideration can be in the form of a higher salary, bonus, or other benefits.
Fourth, the non-compete agreement cannot violate any other laws or regulations in the UAE.
In the UAE, the duration of a non-compete clause is typically limited to six months to two years. The geographic scope of the clause should be reasonable and limited to the area where the employer conducts business. Additionally, the type of activity that is prohibited should be specified in the agreement.
It is also important to note that non-compete clauses cannot restrict an employee`s ability to work. If an employee is terminated or resigns from their position, they should be able to work in their field of expertise without any undue restrictions.
In conclusion, non-compete clauses are legal and enforceable in the UAE as long as they meet certain conditions and do not violate any laws or regulations. Employers and employees should carefully review any non-compete agreements before signing them to ensure that they are fair and reasonable.