Are you leaving a job or signing a new contract? A non-compete clause might be included. This clause aims to limit your right to compete with your employer, even after the end of the contract.

For example, it may prevent you from working for a competitor or starting a business in the same field. While this clause is legal, it must meet specific criteria to be valid. Let’s explore the rules you need to know.

Legal framework

The non-compete clause is governed by article 2089 of the Civil Code of Québec (C.c.Q.). To be valid, it must meet several conditions :

• It must be written into the employment contract;
• It must be clear and specific in its content;
• It must be limited in time, space, and in terms of prohibited activities;
• In case of dispute, the employer must prove its validity before the court.

Limitations of the clause

1. Time limitation

The non-compete clause must be time-limited. That is, it should not prevent the employee from competing with their former employer for too long.

Indeed, the clause must not only be specific in terms of its duration (6 months, 1 year, etc.), but the duration must not be excessive. The non-compete period begins when the employment relationship ends.

Although the law does not set a maximum duration, a period exceeding two years is often considered excessive. This period can be extended if necessary to protect the employer’s interests.

2. Geographical limitation

The employer must choose a territory within which the employee cannot compete. This area must be proportionate to the employer’s activities and must not be vague or overly broad.

An overly broad area could invalidate the clause. For example, a clause covering 60% of Quebec’s population would be excessive. Thus, the geography must be well defined and justifiable.

3. Limitation on type of work

The clause must specify what type of job or tasks will be prohibited to the employee after departure. The clause must target specific activities related to those performed at the former employer. It cannot prohibit the employee from performing any professional activity. For example, a clause prohibiting an employee “from working in the legal field” would be considered abusive.

Warning: It is important to know that if just one of these limits is deemed abusive, the entire clause will be invalidated.

What if there is no non-compete clause?

Without a non-compete clause, an employee may, in principle, compete with their former employer. This may include: working for a competitor, starting a similar business, or investing in a competing company.

However, such competition must remain loyal (art.2088) and in good faith(art.1375). Even in the absence of a clause, certain legal limits still apply.

Courts tend to prohibit behaviors such as :

• Using confidential documents or information from the former employer to solicit clients;
• Persistently soliciting former colleagues and attempting to convince them to leave the employer;
• Keeping property or documents from the former employer.

In conclusion

A non-compete clause can have a real impact on your employment prospects after your contract ends. That’s why it’s crucial to understand your rights before signing a contract or leaving a job.

Do you have doubts or questions? Contact Gaucher Ross Avocats. We’ll help you analyze your contract and protect your interests, whether you are an employee or employer.

To learn more about your rights in the workplace, also see our full article on droit du travail.