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CS Professional · Intellectual Property Rights - Law and Practice · Protection of Trade Secrets

Meera, an engineer, leaves Kavya Tech Ltd and joins a competitor. Her employment contract has a clause barring her from working with any competitor in India for three years after leaving. Kavya seeks to enforce it. What is the likely outcome under Indian law?

The post-employment non-compete is generally void as a restraint of trade under the Indian Contract Act, 1872, so Kavya cannot enforce it. Kavya can still seek an injunction against misuse of its confidential information through confidentiality obligations and breach of confidence.

  1. AThe clause is enforceable because the parties freely agreed to it
  2. BThe clause is enforceable only if Kavya pays damages in advance
  3. CThe post-employment non-compete restraint is generally void under the Indian Contract Act, 1872, though Kavya can still restrain misuse of its confidential informationCorrect
  4. DThe clause is valid for three years but void after that, as courts shorten it to one year

Explanation

Under the Contract Act, agreements in restraint of trade are void, and Indian courts generally do not enforce post-termination non-competes. Confidentiality obligations remain enforceable, so Kavya can still prevent use or disclosure of trade secrets. Courts do not rewrite the period to a shorter one.

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