The case concerned the validity of a non-competition clause in the employment contract for a formerly employed accountant, which stipulated that the employer should receive 50 per cent of the earnings in case the accountant breached the clause. The accountant claimed that the non-competition clause was unreasonable and thus should be declared void.
The Labour Court found that the non-competition clause was not unreasonable considering the sale of the accountant’s business, which had occurred at the time of employment of the accountant. The employer had a justified need for protection of the client base, which had been bought from the accountant’s business. The Court also found that the level of compensation was reasonable since it was related to the economic damages caused by the accountant’s breach. Furthermore, the Court found that the accountant had the possibility to foresee as well as affect the compensation payable in the event of the accountant’s breach. Thus, the Court found that the non-competition clause was valid and enforceable against the accountant.