Non Compete Agreement After Termination Template for Indonesia

The Non-Compete Agreement After Termination is a crucial document used in Indonesian business contexts to protect an organization's legitimate interests following an employee's departure. This agreement becomes relevant when employees have had access to sensitive information, trade secrets, client relationships, or specialized knowledge that could potentially harm the business if used by competitors. Governed by Indonesian law, particularly the Civil Code and Manpower Law, the agreement must establish reasonable restrictions in terms of duration, geographical scope, and prohibited activities. It should include clear definitions of competitive activities, compensation terms, and enforcement mechanisms while ensuring compliance with constitutional rights regarding freedom of work. The document is particularly important in industries with high employee mobility and significant intellectual property concerns.

1. Parties: Identification of the employer and the employee/former employee entering into the agreement

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

3. Definitions: Key terms including 'Competitive Activities', 'Restricted Period', 'Restricted Territory', 'Confidential Information', and 'Competing Business'

4. Scope of Non-Compete: Detailed description of prohibited competitive activities and business sectors

5. Duration of Restrictions: Specific timeframe for the non-compete obligations, ensuring compliance with reasonable duration principles

6. Geographical Limitations: Clear definition of the territorial scope where restrictions apply

7. Consideration: Compensation or benefits provided in exchange for the non-compete obligations

8. Confidentiality Obligations: Provisions regarding the protection of confidential information and trade secrets

9. Acknowledgments: Employee's confirmation of understanding and voluntary acceptance of restrictions

10. Remedies: Legal remedies available in case of breach, including injunctive relief and damages

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

12. Severability: Provision ensuring survival of agreement if certain parts are found unenforceable

13. Execution: Signature blocks and execution requirements