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Is restraint of trade allowed in employment contract? 劳动合同里的竞业条款是否有效?

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Roderick Koh
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Is restraint of trade allowed in employment contract? 劳动合同里的竞业条款是否有效?

Post by Roderick Koh » Wed Mar 27, 2019 11:45 am

Is restraint of trade allowed in employment contract? 劳动合同里的禁业条款是否有效?

Yes, provided that it is reasonable depending on the facts of the matter. The reported case as illustrated below can be referred to for reference.

Case Law:
Worldwide Rota Dies Sdn Bhd v Ronald Ong Cheow Joon [2010] 8 MLJ 297 (High Court)

Brief Facts of the Case:
The defendant worked as a marketing manager of the plaintiff. It was stated in the letter of offer that the defendant was not permitted whilst in employment to engage in any private business tantamount to conflict of interest to ensure the confidentiality of confidential information of the plaintiff. The defendant shall not also be engaged in work of the same trade in Malaysia, Singapore, Thailand, Indonesia, Philippines and Taiwan for immediate period of 3 years from date of resignation. During tenure of employment, the defendant met with plaintiff’s competitors to divulge confidential information and with the current employees to convince them to cease employment. Before the defendant resigned, he informed the plaintiff’s customers that nearly all employees were about to leave.

Court Findings:
Restraint of trade is permissible if it is fashioned in such a way as to prevent a misuse of trade secrets or business connection. In what form the restraint of trade is to be incorporated is irrelevant. What is relevant is the contents of the restraint. The restraint may be contained in an agreement or in a letter. The geographical area of the restraint must be viewed in the context of the ease of travel and the character of the business that is under scrutiny. Where companies operate globally, it would be reasonable to extend the restraint across the globe.

The restraint of trade clause in this case as agreed by the defendant was not draconian and was not in breach of the rules of natural justice. Based on the facts of this case, the restraint of trade clause was reasonable. In considering Section 28 of the Contracts Act 1950, there must be some measure of flexibility. The commercial reality of the matter dictates this kind of approach. Regard must always be had to the nature of the business conducted by the employer. The test of reasonableness must be applied in construing a restraint of trade clause.

依据高庭在Worldwide Rota Dies Sdn Bhd v Ronald Ong Cheow Joon [2010] 8 MLJ 297 (High Court)案件里的判词,如果竞业条款合理不过于严厉,且考虑该条款对雇主业务性质的重要性,可以被译为有效可执行。

但是,上诉法院 (Court of Appeal)分别在2014年和2015年的两个个别案件里阐明,基于合同法第28条文,竞业条款被认为无效。


1. 出售商誉方不为该商业的限制协议 (Saving of agreement not to carry on business of which goodwill is sold)

出售商誉方同意买者于特定的地区不为相似之商业,只要买方或从其出售的商誉中获得权利的他人从事相似之商业:假设该限制与该商业之本质有关,对法庭而言是合理的 。
(Exception 1—One who sells the goodwill of a business may agree with the buyer to refrain carrying on a similar business, within specified local limits, so long as the buyer, or any person deriving title to the goodwill from him, carries on a like business therein: Provided that such limits appear to the court reasonable, regard being had to the nature of the business.)

2. 解散合伙前的合伙人之间的协议 (of agreement between partners prior to dissolution)
(Exception 2—Partners may, upon or in anticipation of a dissolution of the partnership, agree that some or all of them will not carry on a business similar to that of the partnership within such local limits as are referred to in exception 1.)

3. 或于合伙存续期间所定协议 (or during continuance of partnership)

(Exception 3—Partners may agree that some one or all of them will not carry on any business, other than that of the partnership, during the continuance of the partnership.)

1.1950年合同法令 (Contracts Act 1950)
http://www.agc.gov.my/agcportal/uploads ... Umi2Tq9V1w

2. 马来西亚上诉庭的案例
(a)Visioncast Sdn Bhd & 1 Or v Dynacast (Melaka) Sdn Bhd & 2 Others
http://www.kehakiman.gov.my/judgment/fi ... sJOPDu2WRs

(b) Millennium Medicare Services v Nagadevan A/L Mahalingam
http://www.kehakiman.gov.my/judgment/fi ... b3AiSOrC9U

* 以上资讯僅供參考, 不能作为任何个别案件的法律意见。

Last bumped by Roderick Koh on Wed Mar 27, 2019 11:45 am.

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