Definition and Types of Restrictive Covenants
Restrictive covenants are not specifically provided by the Italian Civil Code, and represent a specification of the general ban of unfair competition. The following restrictive covenants are recognised and may be enforceable under the law:
- Non-compete clauses;
- Non-solicitation of customers;
- Non-solicitation of employees.
Enforcement of Restrictive Covenants—process and remedies
In case of violation of a restrictive covenant, the employer is entitled to sue the employee for damages incurred due to the violation and limit payments made for such covenants. Please note that the Judge may also reduce the penalty, if considered disproportionate. It is also possible to ask the Judge for a Court ordered (injunction) preventing the employee from continuing to violate the restrictive covenant
Use and Limitations of Garden Leave
Garden leave as such, does not exist under Italian law. Indeed, an employee has a right to work, even during the notice period. Therefore, to continue paying the salary to the employee during the notice period without him/her working is only permitted with the consent of the employee. In the absence of such consent, in order to prevent (for a limited period of time) the employee from working for other employers, the employer has two options, namely i) agree to a non-compete covenant or ii) let the employee work his/her notice period.