Guidelines on non-compete clauses being finalised; out second half of 2024: Tan See Leng

The government does not condone any exploitative employment contracts, said the Manpower Minister.

SINGAPORE: Guidelines on the use of a job stipulation that restricts an employee from working for a competitor are being finalised and are expected to be made known in the second half of 2024, the Manpower Minister Tan See Leng announced on Tuesday (Feb 6).

Also known as restraint of trade clauses, the non-compete rule has caused unease recently with high-profile examples from two big-name tech firms.

Former Lazada employees who spoke to CNA after the retrenchment exercise in early January questioned their 12-month non-compete clause that covered an extensive list of tech, retail and logistics companies.

Last week, the courts dismissed Shopee’s requests for injunctions against a former employee who resigned and moved to ByteDance. When he first joined Shopee, he had signed a Restrictive Covenants Agreement with a non-solicitation and non-competition clause, as well as an Employee Confidentiality Agreement.

“We understand that overly restrictive restraint of trade clauses can disadvantage retrenched employees and create difficulties in finding employment,” said Dr Tan, responding to several parliamentary questions about Lazada’s recent retrenchment exercise