What is a non-competition clause, and is it always valid?

A non-competition clause is a provision in your employment contract that prohibits you from working for a competitor or starting your own business after you leave your job. Such a clause is not always valid — the law imposes strict requirements, and a court may invalidate or restrict it. Whether your non-competition clause is valid depends on your contract, your role and how the clause is worded.

Last checked: March 2026. Legal information is subject to change — always check the current legislation at wetten.nl.

What does the law say?

A non-competition clause is set out in the law in Article 7:653 of the Dutch Civil Code (check this article on wetten.nl for the most up-to-date version). This article specifies exactly when such a clause is valid and when it is not.

First and foremost, the law states that a non-competition clause must be in writing. A verbal agreement is not valid. It must be included in your employment contract, or in a separate document that you have signed.

Do you have a fixed-term contract? Then extra strict rules apply. Your employer may only include a non-competition clause if they explain in the contract why the clause is necessary. They must justify this on the grounds of compelling business or service interests. If they fail to do so, the clause is immediately invalid — automatically, without you having to go to court.

These additional requirements do not automatically apply to a permanent contract. However, even in that case, a court may set aside or limit the clause. This happens if the clause unfairly disadvantages you in relation to your employer’s interests. The court therefore weighs your interests — you want to work — against your employer’s interests — they want to protect their customers and trade secrets.

Furthermore: if your employer has acted in a seriously culpable manner towards you, the non-competition clause lapses. Think of a situation where your employer has treated you badly, systematically bullied you, or forced you to resign. The court will then assess whether the employer has behaved decently.

Furthermore, the law has been tightened in one key area as of 2025: employers wishing to invoke a non-competition clause may be obliged to pay you compensation for the period during which you are restricted by the clause. Check wetten.nl for the most up-to-date information, as the legislation on this point has recently changed.

When does this apply to you?

Whether the non-competition clause in your contract is valid depends on a number of specific factors. Here are the most common situations.

You have a fixed-term contract
Does your fixed-term contract contain a non-competition clause? If so, it is only valid if your employer has explained in the contract itself why it is necessary. Does it simply contain a standard clause, without any justification? If so, the clause is likely to be void — in other words, it does not legally exist.

You have changed roles Imagine
this: you started as a junior employee and progressed to a key position with access to customer data. If the clause was drawn up for your old role, it may no longer be valid for your current position. The court looks at the situation at the time of signing.

Your employer has dismissed you
If your employer dismisses you — and there was little you could do about it — it is particularly unreasonable if you are also bound by a non-competition clause. The court is then often prepared to limit or set aside the clause.

The clause is very broad
Some non-competition clauses prohibit you from working in any comparable role anywhere in the Netherlands for two years. That is very far-reaching. The broader the clause, the greater the chance that the court will moderate it. The court looks at the duration, the geographical area and the type of work that is prohibited.

You want to start your own
business A non-competition clause also applies if you start your own business. You may then not be allowed to work as a self-employed person in the same sector. Read your contract carefully before registering with the Chamber of Commerce.

Step-by-step guide — what can you do now?

Find your employment contract. Read the non-competition clause word for word. Note the duration, the geographical area and which activities are prohibited.
Check whether the clause is in writing and signed. A verbal clause is not valid. If you never signed it, it is not valid.
Did you have a fixed-term contract? Check whether your employer has provided a reason for the clause. Is there no such reason? Then the clause is likely to be void.
Assess how broad the clause is. Note down the duration, the prohibited area and the prohibited activities. The broader it is, the more likely it is to be challenged.
Gather evidence of misconduct by your employer. Did you leave due to your employer’s culpable conduct? That could render the clause void. Save emails and other communications.
Seek legal advice. An employment lawyer or legal expenses insurer can assess the strength of your case. Many trade unions offer free advice to members.
Take the matter to court if necessary. You can ask the court to set aside or limit the clause. This can be done through summary proceedings if you wish to accept a new job quickly.

Common mistakes

Assuming the clause is valid anyway. Many people sign a new employment contract without realising that an old non-competition clause may have lost its validity. Always double-check this.
Failing to negotiate when starting the job. When signing your contract, you can try to limit the clause — in terms of duration, region or type of activity. Making changes later is much more difficult.
Giving in too quickly. Your employer threatens legal action, and you decide against working for a competitor. But a threatening letter is not a court ruling. Do not let yourself be intimidated without first seeking advice.
Forgetting that self-employed work may also be covered. People think the clause only applies to employment contracts. But even if you start working for a competitor as a freelancer or self-employed person, the clause may still apply.
Taking action too late. If you wait too long to go to court, this could be detrimental — especially if you have already started engaging in prohibited activities.

Frequently asked questions

Can my employer stop me from working for a competitor?

Yes, but only if there is a valid non-competition clause in your contract. The clause must have been agreed in writing. In the case of a fixed-term contract, your employer must also explain why the clause is necessary. If this explanation is missing, the clause is automatically invalid.

What can I do if the non-competition clause restricts me too much?

You can ask the court to set aside or limit the clause. The court will weigh your interest in working against your employer’s interests. If the clause is too broad — in terms of duration, region or type of activity — the court will often moderate it. This can be done through summary proceedings if you want to find a new job quickly.

Does the non-competition clause lapse if I am dismissed?

Not automatically, but it may increase the likelihood that the court will set aside the clause. Certainly if your employer has acted in a seriously culpable manner, the clause lapses by operation of law. Was the dismissal at your employer’s initiative and have you done little to blame? In that case, the court is often sympathetic to setting aside the clause.

Does my employer have to pay me if they invoke the non-competition clause?

Yes, the law provides for compensation for the period during which you are restricted by the clause. The exact rules governing this have recently changed. Check Article 7:653 of the Dutch Civil Code on wetten.nl for the current situation, as these rules have been tightened.

Does a non-competition clause also apply if I start my own business?

Yes, a non-competition clause also applies if you start working as a self-employed person or freelancer in the same sector. It makes no difference to the clause whether you are employed or working on your own account. Read your contract carefully before registering as a business owner.

Relevant legal provisions

Section 7:653 of the Dutch Civil Code — non-competition clause in employment contracts (check this section on wetten.nl for the most up-to-date version)
Article 7:650 of the Dutch Civil Code — penalty clause in employment contracts (check this article on wetten.nl for the most up-to-date version)
See the Civil Code, Book 7, Title 10 for all provisions regarding employment contracts

What is a non-compete clause and is it always valid? | Claim.Cafe