A departing manager is poaching your people

A non-solicitation clause solves a different problem than a non-compete clause for employees

Companies regularly confuse these two tools and then find they only have one of them. A non-compete clause with an employee is aimed at preventing a specific person from engaging in a competing activity for a certain period after their departure; it is agreed in the employment contract and is governed by the Labour Code (Section 310 of the Labour Code). A non-poaching clause aims elsewhere. It obliges the other company not to approach or hire your people. It is concluded between entrepreneurs, typically in a framework agreement with a supplier or in a contract with an outsourcing partner.

The difference is practical. A non-compete clause with an employee does not protect you from a situation where a departing manager joins a partner and gradually brings five other people with them. You have no claim against the partner based on it. The typical course of events is always the same. The manager leaves on their own and in a formally correct manner, nothing happens for the first few months, and the departures only begin after their own notice period has expired. They come one by one, a few weeks apart, and each of them has, at first glance, their own reason.

This is precisely why a non-poaching clause is an agreement worth having signed before the relationship deteriorates. In practice, it is impossible to conclude it at a time when the manager has already resigned. This article deals with an agreement between two companies; a similar obligation can, to a certain extent, also be agreed directly with an employee, but its validity is then assessed according to labour law limits.

Two terms are used for this. A non-solicitation clause means an obligation not to actively approach the other party's employees or customers. A no-hire clause is an obligation not to hire such a person, even if they apply on their own. The difference between them is not just a degree of strictness: a no-hire clause interferes with the choice of profession even for someone who has not signed the contract, and is therefore more easily challengeable as an arrangement going beyond the scope of necessary protection.

What the agreement must contain to be upheld

The Civil Code provides for non-compete clauses between competitors, but makes them conditional. If the agreement prohibiting another from competitive activity does not specify the territory, scope of activity, or group of persons to whom the prohibition applies, the non-compete clause is disregarded (Section 2975 of the Civil Code). Grammatically, this looks like three mandatory requirements at once, but it cannot be interpreted that way.

The Supreme Court, in its judgment Ref. No. 27 Cdo 1318/2017 of 21 November 2018, explicitly rejected this interpretation. It concluded that the provision does not define the mandatory requirements more strictly than the regulation for commercial representation, but emphasizes the general requirement of certainty: the clause must make it clear what activity the obligated party may not perform and to what extent. The extent is understood to mean either a certain territory or a certain group of persons. The court even admitted that a clause agreed "for the whole world" is not, without more, an agreement to be disregarded; it is a matter of reasonableness.

The practical conclusion is different from how these clauses are often written. The risk is not that one of the three boxes is missing, but that the text does not make it clear what is actually prohibited. The scope of activity is the definition of what the prohibition applies to; the wording "any cooperation" is too broad and exposes the clause to moderation. You then describe the scope either by the territory where you actually compete for people, or by the group of persons, typically employees involved in the performance for the other party during a specified period.

In addition, it is necessary to define what is meant by solicitation. Without a definition, the dispute will turn on whether a contact on a professional network was an offer or just a conversation. A usable wording describes the action as an offer of employment or similar engagement made directly or through a third party, including a recruitment agency. The last parameter is time. A clause agreed for an indefinite period or for a period longer than five years is prohibited; if the prohibition is violated, it is deemed to have been agreed for five years.

What is typically agreed in these clauses and where they tend to be excessive

The usual core is a prohibition on actively soliciting the other party's employees during the cooperation and for a certain period after it, supplemented by a contractual penalty derived from the costs of recruiting and training a replacement. Three things tend to be excessive. The duration, which clearly exceeds the time needed to replace the position. The scope, which includes all employees, including those who never participated in the cooperation. And the penalty, the amount of which the company cannot substantiate in any way.

The penalty is where these clauses most often fail. The contractual penalty does not have to equal the anticipated damage, but the court assesses the unreasonableness of the specific claim asserted and takes into account the importance of the protected interest, the manner of the breach, and the circumstances following it (Grand Chamber of the Supreme Court 31 Cdo 2273/2022). Recruitment costs are therefore not a legal condition for validity, but the best available argument for why the agreed amount is reasonable.

A warning sign in the other party's proposal is one-sidedness. If the prohibition is to apply only to you, it means that the other party expects to be the one taking people. The second sign is the absence of a definition of an employee: if the clause does not cover self-employed collaborators, it can be circumvented by hiring the same person as a contractor. The third sign is the lack of a link to the end of the cooperation, because a clause running from the date of signature is often already expired by the time the relationship ends.

However, no specific duration can be presented as a safe standard. The duration and scope are assessed based on whether the restriction is truly ancillary to the main cooperation, objectively necessary for it, and reasonable in its scope of persons, content, and duration. Neither twelve nor twenty-four months legalizes anything on its own; for easily replaceable operational positions, even a shorter period may be excessive.

Where the line is drawn: good morals of competition, competition law, and moderation

The fear that the mere agreement of such a restriction is unfair is not justified. The Supreme Court, in its judgment 23 Cdo 2523/2024 of 7 May 2026, concluded that the application of competitive restrictions between competitors, or making cooperation conditional on such a restriction, does not constitute a phenomenon that is in itself contrary to the good morals of competition (the decision is available in the public database).

In the same decision, the court noted that an agreement on a broader scope of competitive restriction than that provided by law is not, without more, prohibited between participants in economic competition, unless the law provides otherwise in a mandatory provision. However, this concerned an exclusivity reservation, not the poaching of employees, and the court explicitly left aside the assessment under competition law. This can have a different outcome, and that is where the main risk lies today.

The second boundary is therefore competition law, and it is not a marginal one. Agreements between competitors whose object or effect is the distortion of economic competition are prohibited and void (Section 3 of the Act on the Protection of Competition). An agreement not to poach employees is a restriction of competition in the labour market, and competitors in this market can also be companies that do not compete at all in the sale of their products. The fact that the clause is inserted into an otherwise legitimate supply or outsourcing contract does not in itself protect it.

Only a restriction that is genuinely ancillary to the main cooperation, objectively necessary for its implementation, and reasonable in its scope of persons, content, and duration is defensible. Competition authorities in the Czech Republic and at the European level have taken a significantly stricter approach to these agreements in recent years; however, this part of administrative practice cannot be substantiated by the wording of the law and should be verified separately for a specific agreement.

The third boundary is moderation and also applies to an overly broad no-hire clause. If a non-compete clause is more restrictive than required for the necessary protection of the entitled party, a court may, at the request of the affected party, limit it, annul it, or declare it invalid. The word "necessary" is assessed according to your situation, not according to common practice in the industry. A company that invests in certifications and several months of training for its people will be able to defend a broader prohibition than a company whose positions can be filled within weeks.

The last boundary is the employee themself. A clause between companies cannot prohibit them from changing employers; it only binds the other company. The application of a penalty against the partner therefore does not affect the validity of the employment relationship that has since been established. However, the more broadly a no-hire clause is set among major players in the industry, the more likely a court will examine whether it de facto restricts the choice of profession for people who were not aware of it.

What to do when a team has already left

The following steps describe a typical course of action; which of them make sense in your situation depends on whether a clause exists and whether the departing people had access to trade secrets. That is why the lawyers at ARROWS advokátní kancelář assess each case individually. The first step is to secure evidence, and it is the most time-sensitive. This includes exit interviews, email and chat communication in the period before departure, system access logs, and data exports. In two months, some of this will no longer exist.

The second step is to assess what has been breached. If a clause exists, it is a breach of contract and the path is a contractual penalty. If it does not exist, protection against unfair competition and protection of trade secrets are the main considerations, and these require proving specific unfair conduct. The third step is to choose the addressee. Claims under the clause are directed at the partner company, while claims for unfair competition are directed at the person who committed it; this can also be the departing manager as a natural person.

The law does not preclude asserting both at the same time, and the factual circumstances may overlap. Procedurally, however, this is generally not a suitable strategy, because each claim is based on different evidence and is directed against a different addressee. The fourth step is to decide whether to litigate or negotiate. When a team leaves, an agreement on compensation for recruitment costs is usually quicker than a two-year dispute in which it is proven who approached whom first.

The fifth step is to review your own documentation. The departure of a team usually reveals that the company lacks such clauses not only with the partner in question, but also with other suppliers in the same position. The sixth step is to evaluate whether the clauses the company uses today are in order. Most poaching disputes begin with the discovery that although an agreement exists, it is not clear what exactly it prohibits; our text on the invalidity of a non-compete clause discusses why a clause may not be upheld.

For a situation where you have a non-compete clause with an employee and are considering whether to maintain it, our text on the employer's withdrawal from a non-compete clause during the employee's notice period is useful.

What you can claim and what a court will not award

The claims differ depending on what was breached, and this is the main practical reason to have a clause. If one exists, you are claiming performance under the contract and proving only one thing: that what the clause prohibits has happened. If one does not exist, you must prove unfair conduct, which is significantly more difficult.

Without a clause, the defence rests on the general clause of unfair competition, i.e., that the conduct was contrary to the good morals of competition in economic relations and capable of causing harm to other competitors or customers. The mere hiring of a competitor's employee does not meet this condition; something else must be added, typically a targeted and organized action led by the departing manager while their relationship with you was still active.

The second path is the protection of trade secrets. A breach is an act by which someone unlawfully discloses, makes accessible, or uses a trade secret that they learned of on the basis of an employment or other relationship with a competitor (Section 2985 of the Civil Code). First, however, it is necessary to prove that the information in question was a trade secret at all, which is not always a given for a list of employees and their salary conditions.

The scope of claims is the same in both cases. A person whose right has been threatened or infringed by unfair competition may demand that the infringer refrain from unfair competition or remedy the defective state, and further, reasonable satisfaction, compensation for damages, and the surrender of unjust enrichment (Section 2988 of the Civil Code). What a court will not award is the return of the people. Even an injunction is not directed against the employee who left, and the court therefore cannot order them to return.

The practical difference between the two paths lies primarily in the time and cost of evidence. A claim under a clause is based on the contract and documents you have, whereas a claim for unfair competition is based on witness testimony and communications to which you do not have access and must obtain during the proceedings. For the departure of an entire team, this is the difference between months and years. Both paths lead to money, not to the restoration of the original state.

Which of these paths are open in your situation is decided by the wording of the clause and whether the departing people had access to protected information—which is why the lawyers at ARROWS advokátní kancelář assess this before the first demand letter is sent.

Risks of non-poaching agreements

Before you send it to the other party

The first decision is who you want to protect. For most companies, the list of positions whose departure would genuinely harm the business is shorter than ten items. A clause written for this list will pass negotiations and court scrutiny. The second decision is about the penalty. Without a number you can substantiate, the penalty is just a threat; with documented recruitment costs, it is a defensible claim.

The third decision is about where the agreement belongs. For long-term suppliers, in the framework agreement; for projects, in the specific order. Inserting it into a document that is signed only after the cooperation has begun is too late. The fourth decision concerns the internal aspect. A clause with a partner protects against departures to them, not against departures in general. Alongside it, you need to have managed access to data and customer contacts, because that is what determines the extent of the damage the departure will ultimately cause.

The fifth decision is a competition law one. For a partner with whom you compete for the same people, the agreement belongs for an assessment of competition risk before signing, not in a dispute. The context of commercial non-compete clauses in general is summarized in our text on non-compete clauses in commercial relationships.

Final summary

A non-poaching clause is an agreement between two companies and protects against a situation that a non-compete clause with an employee cannot reach: a partner gradually taking over the people who worked for you. The article has shown that its enforceability is not decided by the strictness of the wording, but by the certainty of what is prohibited and to what extent, the reasonableness of the agreed penalty, and the competition law dimension of the entire agreement.

Without a clause, the remaining defence is exponentially more difficult. The mere departure of people to a competitor is permissible competition, and the company must prove specific unfair conduct or a breach of a trade secret. This is the difference between one page of a contract and a two-year process of providing evidence, the outcome of which no one knows in advance.

For owners and management, this leads to one decision, and it is an organizational one. The list of people whose departure would genuinely harm the company is short and can be written in an hour; a clause written for this list will pass negotiations and court scrutiny, and at the same time will withstand a competition law perspective. Postponing it until the relationship with the partner deteriorates practically means not signing it at all.

The cost of delay will not be apparent at the time of departure, but six months later, when the company discovers that it has lost not only people, but also the contracts that depended on them. The lawyers at ARROWS advokátní kancelář prepare and negotiate contractual documentation for the protection of people and know-how, assess it from a competition law perspective, represent clients in unfair competition disputes, and train management on what to do in the first days after a key person leaves.

If you want to check whether your current contracts contain such protection at all, write to consultation@arws.cz or browse our practice in labour law.