The Non Compete Agreement And Non Solicitation Agreement is essential for businesses operating in Indonesia seeking to protect their legitimate interests, trade secrets, and valuable business relationships. This document is typically used when onboarding new employees or during significant role changes where employees gain access to sensitive information or develop important client relationships. It must comply with Indonesian legal requirements, particularly Labor Law No. 13 of 2003 and the Civil Code, while ensuring restrictions are reasonable in scope, duration, and geographic coverage. The agreement includes specific provisions for non-competition and non-solicitation, defines restricted activities, territories, and time periods, and outlines consequences for breach. It's particularly relevant in today's dynamic business environment where employee mobility and protection of competitive advantages are crucial concerns.
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1. Parties: Identifies and defines the contracting parties - typically the employer/company and the employee/contractor
2. Background: Sets out the context of the agreement, including the nature of the relationship between the parties and the legitimate business interests being protected
3. Definitions: Defines key terms used throughout the agreement, including 'Confidential Information', 'Competitive Business', 'Territory', and 'Restricted Period'
4. Non-Compete Obligations: Details the specific restrictions on competing activities, including scope, duration, and geographical limitations
5. Non-Solicitation Obligations: Specifies restrictions on soliciting employees, customers, suppliers, and business partners
6. Duration and Territory: Clearly defines the time period and geographical area where the restrictions apply
7. Consideration: Specifies the consideration provided in exchange for these restrictions, as required under Indonesian law
8. Acknowledgments: Employee's acknowledgment of the reasonableness of restrictions and receipt of consideration
9. Confidentiality Obligations: Requirements regarding the protection of confidential information and trade secrets
10. Breach and Remedies: Consequences of breach and available remedies, including injunctive relief
11. General Provisions: Standard clauses including governing law, severability, and modification
12. Execution: Signature blocks and execution requirements
1. Garden Leave: Additional provisions for paid leave period during which employee remains employed but does not work - used for senior positions
2. Return of Company Property: Specific provisions regarding return of company assets and materials - used when employee has access to significant company property
3. Independent Legal Advice: Acknowledgment of receiving independent legal advice - recommended for senior employees or complex restrictions
4. Dispute Resolution: Specific procedures for resolving disputes, including mediation or arbitration - used in high-value agreements
5. Training and Investment Recoupment: Provisions regarding repayment of training costs or other investments - used when company has made significant investments in employee development
6. Survival Clause: Specifies which provisions survive termination of employment - important for complex agreements
1. Schedule A - Restricted Territory: Detailed description and/or maps of the geographical areas where restrictions apply
2. Schedule B - Competitive Business: Detailed list of competitor companies and/or restricted business activities
3. Schedule C - Consideration Details: Breakdown of any financial or other consideration provided in exchange for the restrictions
4. Schedule D - Confidential Information: Detailed list or categories of confidential information covered by the agreement
5. Appendix 1 - Customer List: List of customers covered by non-solicitation provisions (if applicable)
6. Appendix 2 - Employee Acknowledgment: Formal acknowledgment of understanding and acceptance of terms
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