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Job clauses are no longer valid

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Legal news
calendar 31 January 2021
globus Denmark

With the Danish Act on Restrictive Employment Clauses which entered into force on 1 January 2016, the main rule is that companies cannot enter into agreements on job clauses. However, agreements on job clauses concluded before 1 January 2016 remained valid until 1 January 2021. This deadline has now expired which means that all job clauses as a main rule no longer are valid.

A job clause, also known as a non-solicitation of employees clause or no-hire clauses, is an agreement between companies or between a company and employee to prevent or limit employees’ possibility of employment in another company. We have previously written about the Danish Act on Restrictive Employment Clauses, here.

Companies can as a main rule no longer enter into agreements on job clauses, and existing agreements regarding job clauses that were valid until the 1 January 2021, are no longer lawful. Despite this deadline, companies can still use job clauses in connection with negotiations on transfer of undertakings. However, this does not apply to employees that have been employed for up to 3 months in the transferring company.

IUNO’s opinion

From 1 January 2021, existing agreements with job clauses are no longer lawful. Companies should therefore review their existing agreements. Going forward, companies can only use job clauses to a limited extent. Companies must be aware of the situations in which job clauses are valid. When in doubt, companies should always seek legal advice.

[The Danish Act on Restrictive Employment Clauses of 15 December 2015]

A job clause, also known as a non-solicitation of employees clause or no-hire clauses, is an agreement between companies or between a company and employee to prevent or limit employees’ possibility of employment in another company. We have previously written about the Danish Act on Restrictive Employment Clauses, here.

Companies can as a main rule no longer enter into agreements on job clauses, and existing agreements regarding job clauses that were valid until the 1 January 2021, are no longer lawful. Despite this deadline, companies can still use job clauses in connection with negotiations on transfer of undertakings. However, this does not apply to employees that have been employed for up to 3 months in the transferring company.

IUNO’s opinion

From 1 January 2021, existing agreements with job clauses are no longer lawful. Companies should therefore review their existing agreements. Going forward, companies can only use job clauses to a limited extent. Companies must be aware of the situations in which job clauses are valid. When in doubt, companies should always seek legal advice.

[The Danish Act on Restrictive Employment Clauses of 15 December 2015]

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Etgen Reitz

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Hessellund Klausen

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Astrup

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Groth Henriksen

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