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My contract (with a company in the DIFC) has a pretty standard non-compete clause that prevents me working for a competitor for six months. I'm not planning to leave immediately but may want to switch jobs at some point in the next year or so. Because I work in a pretty specialised area, I would almost certainly move to a direct competitor.

Does anyone have any experience or insight into whether non-compete agreements are enforced in practice in the UAE, and how easy/difficult it is for a company to enforce non-compete restrictions through the courts? I assume that the applicable law/court in this case would be the DIFC employment law and the DIFC courts.

jayzed wrote:My contract (with a company in the DIFC) has a pretty standard non-compete clause that prevents me working for a competitor for six months. I'm not planning to leave immediately but may want to switch jobs at some point in the next year or so. Because I work in a pretty specialised area, I would almost certainly move to a direct competitor.

Does anyone have any experience or insight into whether non-compete agreements are enforced in practice in the UAE, and how easy/difficult it is for a company to enforce non-compete restrictions through the courts? I assume that the applicable law/court in this case would be the DIFC employment law and the DIFC courts.

Unless the 'no competition" clause was agreed to under duress, is ureasonably long or unrelated to your line of work, it will be "enforceable".

Finding out whether it is "enforceable" in any venue: court, arbitration, etc. is only part of the issue.

Here are just two scenarios:

1.You leave the company and go work for a competitor. In the process you take clients, trade secrets and/or business away from your present employer. Any Employer concerned about its business will sue you and seek and injuction from the court preventing you from working for the new company (in addition to immigration issues if applicable). This will involve costs and agrevation for you and your new employer. The most likely scenario is that 6 months will pass before the matter is resolved during which there would be great expense. After the 6 months the case would be "moot" as you would be free to be employed by the competitor.
It the non-competion term is longer (but reasonable) then more expense and aggrevation.

2. You leave your company and work for a competitor. You take no client or business away from your employer. The employer would care less about where you go as it does not impact its business.


In either case above, whether or not the clause is "enforceable" is not an issue that is decided by a court. It is simply a "business" decision.

Most, if not all, employment contracts in UAE seem to have this non-competition clause even if non-applicable. Someone saw such clause somewhere and decided it was a good idea to copy it - copy cats abound.

Surely there are cases, where the issue of enforceability of the non-competition are worth litigating. These usually involve huge business, trade secrets, etc. and almost always involve senior level individuals joining the direct competitors.

In any event, the UAE is a Civil Code Jurisdiction so that the concept of "precedent" need not be followed so that each case is ajudicated case-by-case!

The bottom line is that an Employer should not be a place for training its competitors. The non-competion clause is and should be enforced, in the right case, in order to maintain some semblance of "business order" - plus the lawyers need feeding from time to time. The insertion of such clause is a matter of "negotiations" before you sign the employment contract (sometimes that "negotiation" opportunity is not present).

It's like the speeding: is the law enforced? Only if you get caught!

non-competition clauses CANNOT be enforced unless specifically included in your official labour contract - the one that is registed with the department of labour.

the "contract" that you are probably talking about is in real terms an "agreement" with the employer, none of which is enforcable under the labour law. remeber all legal and binding documentation in the uae (that which is enforcable by uae law) must be in arabic! your "contract" which contains the non-competition clause is only enforcable if it was lodged and registered along with your official labour contract (which never happens!).

if you look at one of the sticky's posted above you will see i went into the issue regarding the validity of "western contracts" and offer letters.

“Arabic shall be the sole language to be used in all records, contracts, files, statements and other documents provided for in this law or in any resolution or regulation issued in implementation of its provisions. Arabic must also be used in instructions and circulars issued by the employer to his employees. However, in the event where a foreign language is used by the employer alongside Arabic, the Arabic text shall prevail.”


a non competitive clause can be added to your official labour contract at two points - once when it is lodged, and secondly it can be added just before it is cancelled at the labour office (in which case it would be enforcabel).

be very careful what you sign for before you leave. you are not obliged or compelled to sign anything - they may try to slip it in amongst the papers you have to sign - remember it will be in arabic to be legal, so do not sign any arabic papers without them being translated first (prefrably by an independant party) - even though they may include an english cover verison... double check it

sorry, i forgot. one of the primary reasons the 6 month labour ban was originally introduced was to enforce a non-competitive clause on employees! obvioulsy this law has now been warped and adjusted into a money making scheme!

I forgot also and dbxsoul is right of course regarding the "official labour contract" in the UAE.. Look at the contract that was registered (if it has) which you should have. Of course the practical aspect of the "enforceability" still apply (see above). You may have to go to court to argue "non-enforceability, etc." all at a cost...

Do companies here really go to court to enforce these clauses. To me, most companies here appear to be terribly lazy and stingy. I know people who jump from company to company (some even NMC), taking client contacts with them, and I keep asking why the hell they aren't banned yet. When I mention this, they act like the six-month ban is a non-issue. It leads me to believe that most companies don't follow through.

gtmash wrote:Do companies here really go to court to enforce these clauses. To me, most companies here appear to be terribly lazy and stingy. I know people who jump from company to company (some even NMC), taking client contacts with them, and I keep asking why the hell they aren't banned yet. When I mention this, they act like the six-month ban is a non-issue. It leads me to believe that most companies don't follow through.

Your belief is correct.


Now, unmarried living together...

yes, as i pointed out last week most companies (well the pro's and management) are fully aware of the employees rights as well as thier own with respect to labour issues.

they simply rely on the employee not being fully aware of his legal standing on labour issues to bluff them into compliance.

Thanks for your responses. As far as I'm aware, when I'm working in the DIFC, the issue of an official labour contract in Arabic lodged with the department of labour does not arise - my employment is governed by the DIFC Employment Law, not by UAE/Dubai labour law. Please correct me if I'm wrong!

The employer in question is an international company that I've employed by (outside Dubai) for more than five years. The non-compete clause is standard in all contracts, but seems to be pretty inconsistently applied. We've certainly had someone at about the same level as me (but in a different part of the business) go to a direct competitor in Dubai before, and as far as I know they didn't try to enforce his non-compete clause... I guess I'll just have to suck it and see, if the situation ever arises.

my employment is governed by the DIFC Employment Law, not by UAE/Dubai labour law. Please correct me if I'm wrong!

true, but the FZ laws are based on the uae labour law, about 95% of it in anycase. did you get a proper labour contract - arabic/ english one?

give it a try, what have you got to loose?[/quote]

i have a similar issue with a semi-government compay. maybe someone can help me out here, would appreciate it

i had a non-compete clause in my contract - 12months, not to work in my field, be it with a competitor, as an agent or a consultant of any kind.
My job is very specific to a certain industry and therefore it is not easy to find a job if your non-compete cluase states all the above.
I've been out of work since I resigned and left the company and had to move back to Europe.
However now I've been approached by a competitor to work on a project in direct competition to my old company (as an employee or a consultant) and am wondering whether I can take up the opportunity. They need me to start working immediately,but I still have 3 months non-compete ...

I have also heard that unless there was a contract in arabic that I have signed the court will not take this case in cosideration, as Arabic is the legal language and therefore the english contract is not valid or can be used in court against me. - Is this true?

My questions:
1. Is 12 months a reasonbale time? It seems a very long time to go without earnings.
2. In Europe the law states that if the employee is to respect the non-compete clause the employer must compensate the employee, ie a 12 months salary to be paid to the employee in that case. Can this be demanded in the UAE as well?
3. How far can a semi-gov company go with sueing me at this stage (with only 3months to go)
4. I would be working out of Europe, so can they actually sue me?
5. Would they be able to stop me at the airport and take me in? I have heard of these cases happen.
6. What are the costs and my chances to win this case if they were to sue me.

Thank you to anyone who can advise me.

First thing, the UAE is not Europe, so none of the commonly accepted niceties such as compensation are an option.

All legal cases pertaining to UAE law can only be contested or tried in the UAE; the UAE does not recognise judgments that may be made outside of the country.

I’m assuming that your previous employer was a 100% UAE (nationally owned company)? If it were part of a multi-national you could well face consequences brought against you by the multi-national portion of the company and not the UAE Company.

Is the company you are considering competing directly with your previous employer (in the Middle East), or simply a company competing in the same field, but in a different competitor market i.e. market territory?

I can only remember seeing one instance where a suit was filed for non-competition and that was for someone in the banking field who went to work for a direct competitor in Dubai and had a specific non-competition clause.

If you had a valid labour card and residency visa with your previous employer then you had a legal labour contract – the dual English/ Arabic (double sided) page. Normally any non-competition clause has to be included in this contract – on the reverse side of the contract under the heading “Other”.

If it is not included on (or appended to) this document and lodged with the Department of Labour then it is not recognised, you should have a copy of this document somewhere (the employees copy), check it and see.