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Active Non Compete Agreement Template for Philippines

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Key Requirements PROMPT example:

Active Non Compete Agreement

"I need an Active Non-Compete Agreement for a senior software developer in our Manila-based fintech company, with specific restrictions on working for digital payment competitors within Southeast Asia for 12 months after employment ends, starting January 2025."

Document background
The Active Non-Compete Agreement is a crucial document for businesses operating in the Philippines seeking to protect their legitimate interests while maintaining compliance with local laws. This agreement is typically implemented when an employee has access to sensitive information, key client relationships, or valuable trade secrets. The document must carefully balance the employer's need to protect business interests with the employee's constitutional right to work, as recognized under Philippine law. The agreement includes specific provisions regarding duration, geographical scope, and prohibited activities, ensuring they are reasonable and enforceable under Philippine jurisdiction. An Active Non-Compete Agreement is particularly important in industries with high employee mobility or where competitive advantages are based on proprietary knowledge or client relationships.
Suggested Sections

1. Parties: Identification of the employer and employee, including complete legal names and addresses

2. Background: Context of the agreement, employment relationship, and legitimate business interests being protected

3. Definitions: Clear definitions of key terms including 'Confidential Information', 'Competitive Activity', 'Territory', and 'Restricted Period'

4. Scope of Non-Compete: Detailed description of prohibited competitive activities and specific roles/positions covered

5. Duration and Geographic Coverage: Specific timeframe and territorial limits of the non-compete obligations, ensuring reasonableness under Philippine law

6. Legitimate Business Interests: Clear articulation of the business interests being protected, including customer relationships, trade secrets, and proprietary information

7. Consideration: Details of compensation or benefits provided in exchange for the non-compete obligations

8. Acknowledgments: Employee's acknowledgment of the reasonableness of restrictions and receipt of consideration

9. Remedies: Consequences of breach, including injunctive relief and damages

10. Severability: Provision for maintaining validity of remaining clauses if any part is found unenforceable

11. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

12. Entire Agreement: Statement that this document represents the complete agreement regarding non-compete obligations

Optional Sections

1. Garden Leave: Optional provision for paid leave during initial period of restriction, used for senior executives or key personnel

2. Industry-Specific Restrictions: Additional restrictions specific to particular industries or professions, used when standard restrictions are insufficient

3. Training and Development Costs: Provisions regarding repayment of training costs, used when significant investment in employee development exists

4. Client Non-Solicitation: Specific provisions regarding client relationships, used for client-facing roles

5. Employee Non-Solicitation: Restrictions on recruiting other employees, used for management-level positions

6. Post-Employment Cooperation: Requirements for cooperation in transition of duties, used for key positions

Suggested Schedules

1. Schedule A - Restricted Territory: Detailed map or list of geographic areas covered by the non-compete restrictions

2. Schedule B - Restricted Businesses: Comprehensive list of specific competitors, business types, or activities that are restricted

3. Schedule C - Compensation Details: Specific details of consideration or compensation provided for the non-compete obligations

4. Appendix 1 - Confidential Information: Detailed categorization of confidential information and trade secrets covered

5. Appendix 2 - Key Clients: List of specific clients or customer relationships protected by the agreement

6. Appendix 3 - Employee Acknowledgment: Formal acknowledgment form for employee signature confirming understanding and acceptance

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions


























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Relevant Industries

Technology

Financial Services

Professional Services

Healthcare

Manufacturing

Telecommunications

Retail and E-commerce

Pharmaceuticals

Consumer Goods

Business Process Outsourcing

Energy

Real Estate

Relevant Teams

Executive Leadership

Sales

Business Development

Research and Development

Product Development

Information Technology

Client Services

Operations

Finance

Marketing

Human Resources

Legal

Strategy

Relevant Roles

Chief Executive Officer

Chief Technology Officer

Senior Manager

Sales Director

Account Executive

Research and Development Manager

Product Manager

Business Development Manager

Technical Lead

Senior Software Engineer

Financial Controller

Operations Manager

Marketing Director

Client Relations Manager

Regional Manager

Department Head

Senior Consultant

Key Account Manager

Industries






Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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