Mixing cucumbers also involves trade secrets? After the chef jumped ship, he was claimed more than 100,000 yuan by the original company

Recently, a court precedent on non-compete agreements has aroused public concern. Liu, a cold dish chef whose daily job is to make mixed cucumbers and boiled edamame, was sued by the original company for violating the non-compete agreement because he did the same work in two other restaurants after he left his job, demanding liquidated damages and losses totaling more than 100,000 yuan.

The court found that the agreement signed between the catering company and Liu should be invalid and rejected the litigation claim of the original catering company. Are non-compete agreements to prevent unfair competition abused? Where exactly are the boundaries of its application?

The cold dish chef left his job and continued to mix cucumbers

Sued by the original company for compensation

The defendant Liu was a chef who was engaged in the production of cold dishes in the plaintiff's catering company, such as mixing cucumbers and boiled edamame, and the company believed that in the process of making cold dishes, Liu would master some secret recipes for cold dishes or seafood dishes, which might affect the company, so the two parties signed a confidentiality and non-compete agreement, which is the non-compete agreement referred to in the law: if Liu resigns, he will not be able to engage in similar work within two years, and if he breaches the contract, he must pay the corresponding liquidated damages.

In May 2022, Liu resigned from the catering company and joined two other hotels successively. The plaintiff believed that the defendant's move had a certain impact and impact on his business. The defendant argued that he was only a cold dish chef and was only slightly familiar with the production process, but it did not constitute a professional technical secret.

A non-compete agreement generally refers to an agreement between an employer and an employee that, for a certain period of time, the employee will not be offered a job by another employer that is in competition with the employer that produces or sells similar products or engages in similar business with the employer.

The People's Court of Jiangning Economic and Technological Development Zone, Nanjing City, Jiangsu Province, held that the non-compete agreement signed between the catering company and Liu should be invalid. Presiding Judge Peng Yan explained that according to Article 24 of the Labor Contract Law, the non-compete restriction is limited to the senior management personnel, senior technical personnel and other personnel with confidentiality obligations of the employer. As an ordinary worker, Liu does not belong to one of the above three situations.

Peng Yan introduced that the Labor Contract Law has a catch-all clause for other employees who are obliged to maintain confidentiality, and in reality, some employers will take advantage of this to restrict employees. However, the actual judicial application will also make it clear that other employees with confidentiality obligations refer to those who can know and have access to certain technical secrets, and these personnel may be ordinary technical personnel, but the job information they have access to is the company's core technical or business secrets. Defendant Liu's engagement in the production of cold dishes, generally speaking, is not technical and secretive, and is not suitable for agreeing on non-competition.

Legal sense

What is the definition of a trade secret?

Whether the work content that the employee is exposed to is a trade secret or intellectual property-related content becomes the key to determining whether a non-compete agreement should be signed.

As early as 2022, the Nanjing Jiangning Economic and Technological Development Zone People's Court disclosed a dispute over a non-compete agreement. After defendant Liu XX joined a manufacturing company in Nanjing, the two parties signed a non-compete agreement. When the two parties terminated the labor relationship, they again clarified the rights and obligations of the non-compete restriction, and agreed that Liu Moumou would not work for other employers with competing relationships within two years after his resignation.

After leaving the company, Liu Moumou signed a labor contract with a talent company and went to work in an energy company with a labor outsourcing cooperative relationship. However, the energy company had a non-compete relationship with a manufacturing company in Nanjing. A manufacturing company in Nanjing believed that Liu had violated the non-compete agreement and sued the court. After the trial, the court held that the employee should be liable for breach of contract if he circumvented the scope of the non-compete restriction in a concealed manner.

Jiang Ying, vice president of the China Society Law Research Association, believes that only trade secrets that have the three characteristics of secrecy, value and protection at the same time can use non-compete agreements, and cannot be arbitrarily expanded by other employees who have confidentiality obligations at the discretion of the employer.

Expert: The specific content of the non-compete agreement

It must be both legal and reasonable to avoid abuse

In the view of many practitioners and experts, non-compete agreements are showing a trend of abuse.

A human resources expert who has worked for a number of Internet companies said that in practice, there are more and more cases of non-compete agreements being signed. "Push forward five or ten years, generally speaking, executives will use non-compete agreements, and there are more middle-level applications. However, in recent years, some grassroots managers and even some grassroots employees will sign non-compete agreements. Many companies will classify customer information as confidential and core, and the company will ask the customer service staff to sign a non-compete agreement on the grounds that the customer service has access to direct customer information, and if the employee is not used by me, it cannot be used by others. ”

Zuo Xiangqi, a labor law expert and senior labor dispute arbitrator, said that the unrestrained use of non-compete agreements will cause a waste of social labor resources to a certain extent. There are two sides to a non-compete agreement:

• From the perspective of a single enterprise, it can avoid damage to its own interests.

• From the perspective of the overall value of society, there may be some impact on employment, employee growth and income.

Jiang Ying believes that the specific content of the non-compete agreement should be both legal and reasonable, and the employer should not use its strong position to infringe on the employment rights of workers to move freely.

Jiang Ying: There are some provisions in the Labor Contract Law that are not very specific, such as compensation for violation of non-compete agreements, the scope and duration of non-compete restrictions, all of which are determined by negotiation between the employer and the employee. Under the labor relationship, the status of the employer and the worker is unequal, which causes the worker to passively accept, which actually violates the worker's right to freedom of choice of employment, and at the same time affects the free flow of talents in the whole society.

Jiang Ying said that in addition to improving the non-compete agreement in the legislation, the court can also pass some precedents to provide some guidance on the non-compete agreement. In addition, non-compete agreements can also be formulated through some internal rules of the enterprise, such as through the democratic procedures of workers' congresses and trade unions, to define the boundaries of their use. It can not only play a role in protecting enterprises, but also protect the right of workers to choose jobs freely and promote the flow of talents.

(Source: Voice of China of China Central Radio and Television The copyright belongs to the original author, if there is any infringement, please contact to delete (21))