No Agreement On Economic Compensation And Agreement Is Stipulated In The Competition Restriction Agreement

The twenty-third provision of the labor contract law stipulates that employers and workers can stipulate the business secrets of the employing units and the confidentiality matters related to intellectual property rights in the labor contract. For a laborer who has a duty of confidentiality, the employer may agree with the laborer in a labor contract or a confidentiality agreement. Competition restriction clause And stipulates that the worker shall be given laborers within the time limit of the competition after the termination or termination of the labor contract. economic compensation 。 If a laborer violates the stipulations of the competition restriction, he shall pay liquidated damages to the employer in accordance with the contract. The law stipulates that employers should give laborers financial compensation within the time limit of competition. However, in practice, many employers have no provisions for economic compensation in the competition agreement signed with the laborers, or although there is a stipulation, the employers actually do not pay. Under such circumstances, is the competition restriction agreement effective? Is it still binding on the laborers? Labor Contract Law And the regulations on the implementation of the labor contract law do not stipulate this, resulting in different handling of such cases in judicial practice, which seriously damages the unity of the application of law. The author analyzes the impact of the limitation of competition on the effectiveness of the competition restriction agreement according to the guiding opinions issued by several provinces and cities with multiple labor disputes, hoping to provide some references for readers to apply such cases in judicial practice.

The provinces of Beijing, Shanghai, Guangdong, Jiangsu and Zhejiang are the focus of China's labor dispute cases. Therefore, the understanding of this issue basically represents the mainstream opinions in the current judicial practice. Through the analysis of the guiding opinions issued by the above provincial and Municipal Higher People's court and the labor dispute arbitration committee, the author holds that there are three viewpoints in the judicial practice that the competition restriction agreement is not effective when there is no agreement on economic compensation, that is, "effective", "invalid" and "undetermined effect".

First, "effective theory", with Shanghai as the representative.

Thirteenth opinions of the Shanghai Higher People's Court on Several Issues concerning the application of the labor contract law, the provisions of the "parties' handling of unclear provisions on the articles of competition restriction", stipulate that the parties to the labor contract only stipulate that the laborers shall perform the obligation of competing restrictions, but if they do not specify whether they should pay the compensation to the laborers, or although the directional workers pay the compensation, but do not specify the specific payment standard, the competition restriction clause can be considered binding on both parties based on the consistent expression of the parties' restrictions on the competition. If the amount of compensation is unknown, the two sides may continue to negotiate on the standard of compensation. If the consultation fails to reach a consensus, the employer shall pay according to the 20-50% of the normal wage of the laborer. Negotiation can not reach agreement. The period of limitation should not exceed two years. According to the guidance, if the employer fails to pay the economic compensation or the payment standard is not stipulated in the competition restriction agreement, the competition restriction agreement is still valid, the laborer shall perform the obligation of competition restriction, and the employing unit also needs to pay the economic compensation. The economic compensation standard can be negotiated and agreed, and the 20-50% can not be negotiated according to the normal wage of laborers.

Two, "invalid theory", represented by Jiangsu and Zhejiang.

The Jiangsu Provincial Higher People's court and the Jiangsu Labor Dispute Arbitration Commission issued the notice on the guiding opinions on labor dispute cases. Thirteenth, the employer and the laborer have agreed on the terms of competition, but have not agreed on economic compensation, or have agreed on economic compensation, but have not agreed to pay the contract. The guiding opinions of the Jiangsu province directly deny the validity of the agreement on competition agreement for the employing unit's economic compensation or agreement, but fail to pay the economic compensation according to the agreement, and the competition restriction agreement has no legal binding force on the laborers. Without legal binding force, of course, it can be understood that there is no legal effect. However, the guiding opinion has added one sentence in the thirteenth paragraph and the second paragraph. The laborer has complied with the competition restriction clause, but the employer has not paid the economic compensation according to the agreement, and the laborer's request for the employer to pay the economic compensation should be supported. The two sides have not stipulated the compensation standard or the stipulated compensation standard is lower than the standard stipulated in the seventeenth regulations of the Jiangsu labor contract regulations. The laborer's request should be supported by the standards stipulated in the seventeenth regulations of the Jiangsu labor contract regulations.

The notice of the Zhejiang Labor Dispute Arbitration Commission on Issuing the guiding opinions on Several Issues concerning the handling of labor disputes cases (Trial Implementation) thirty-first provides that employers and workers agree on the restriction of competition but do not agree on economic compensation at the same time, or that the amount of economic compensation is too low to maintain the lowest standard of living for workers. It is a case in which article twenty-sixth (two) of the labor contract law stipulates that "the employer is exempt from its legal obligations and excludes the rights of laborers". The restriction clause or agreement is invalid. The thirty-second rule provides that one of the following circumstances is that the terms of the competition restriction shall no longer be binding on the laborers: (4) the employer fails to pay the economic compensation according to the agreement. {page_break}

Three, "the effect is to be determined", represented by Beijing and Guangdong.

The Beijing labor and Social Security Bureau and the Beijing Higher People's court's thirty-ninth summary of the Symposium on the application of law on labor dispute cases stipulates that employers and workers have agreed on the terms of competition in the labor contract or confidentiality agreement, but have not agreed on the payment of the compensation fee or the standard of specific payment. They should not be held to be ineffective. The two parties can remediate through consultation, and if they fail to reach an agreement through consultation, they can pay the compensation fee in accordance with the 20% to 60% of the last worker's salary before the termination of labor relations between the two parties. If the employer expressly does not pay the compensation fee, the terms of the competition restriction shall not be binding on the laborers.

The Guangdong Higher People's court and the Guangdong labor dispute arbitration committee apply the labor dispute mediation and Arbitration Law and the labor contract law. The twenty-sixth provision provides that the employing unit and the laborer agree on the competition restriction, and shall give the laborers economic compensation within the time limit of the system of competition. If the employer fails to pay the economic compensation according to the agreement, the laborer may request the employer to perform the agreement on the competition. When the completion of the handover is completed, the terms of the competition restriction shall not be binding on the laborers.

Four. Comment on the three points of view.

The purpose of the competition restriction is to protect the commercial secrets of the employing units. However, due to the restriction of the competition restriction on the right of employment, it is necessary for the employer to pay the economic compensation to the laborers, and it is the compensation for the laborers' right to choose jobs. According to the nature of the contract, the competition restriction agreement is a bilateral contract. If the employer fails to pay the compensation for the competition restriction, the worker can not perform the agreement on competition. Shanghai stipulates that the employer has not paid the financial compensation to the targeted workers or fails to stipulate the standard of payment in the competition agreement. The competition restriction agreement is still valid, the laborer must perform the obligation of competition restriction, the employing unit also needs to pay the economic compensation, the standard of economic compensation can be agreed to, and the 20-50% can not be negotiated according to the normal wage of the laborer. This seems to have the suspicion of compulsory execution by both sides.

Jiangsu and Zhejiang stipulate that the employing units do not agree on economic compensation, or have agreed on economic compensation but have not paid. It is too arbitrary to directly identify the null and void agreements. In practice, some employers fail to stipulate economic compensation in the agreement due to negligence or lack of legal knowledge, but their purpose is not to harm the interests of workers. In this case, if the employer is willing to pay economic compensation, but the worker does not agree with the request that the employer pay the economic compensation on the ground that the agreement does not stipulate the economic compensation, the court ordered the agreement to be invalid. If the court directly denies the validity of the agreement, it is also inappropriate.

Beijing and Guangdong stipulate that there is no agreement on the limitation of competition compensation, which does not result in the invalidation of the agreement. Only when the employer fails to pay the economic compensation, the competition restriction agreement will not have legal effect. The economic compensation is not stipulated in the agreement, and it is not necessary to draw the intention that the employer has "absolve its legal responsibility and exclude the rights of laborers". If the employer expressly does not pay the economic compensation, it will explain that it has the intention of "abstaining from its legal responsibilities and excluding workers' rights". The author believes that the provisions of Beijing and Guangdong are relatively reasonable, which not only takes into account the requirements of the protection of the employer's business secrets, but also protects the legitimate rights and interests of the workers, and fully grasps the legislative spirit of the labor contract law.