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A Restrictive Covenant Agreement is a legal contract that protects a company's business interests by limiting what employees can do after they leave. Under Danish employment law, these agreements typically restrict former employees from working for competitors, poaching clients, or using confidential information for a specific time period.

Danish law sets strict rules about these agreements - they can't last more than 12 months after employment ends, and employees must receive compensation worth at least 40% of their monthly salary during the restriction period. Companies often use them for key roles involving sensitive data, trade secrets, or valuable client relationships.

Use a Restrictive Covenant Agreement when hiring employees who will have access to valuable business secrets or close client relationships. This is especially important for senior managers, sales representatives, and technical specialists who could harm your business by taking knowledge to competitors. Danish law allows these agreements to protect legitimate business interests.

Timing matters - introduce the agreement during the hiring process or when promoting employees to sensitive positions. Remember that under Danish regulations, you must provide fair compensation and keep restrictions under 12 months. The agreement works best for roles where the potential damage from competition outweighs the cost of post-employment compensation.

• Non-Compete Clauses: Prevent former employees from working for competitors or starting competing businesses within specific geographic areas
• Non-Solicitation Provisions: Stop ex-employees from approaching your clients or poaching your staff
• Confidentiality Agreements: Protect trade secrets and sensitive business information even after employment ends
• Combined Restrictions: Blend multiple protective measures with customized compensation levels based on restriction scope
• Customer Contact Limitations: Specifically restrict contact with customers where the employee had direct relationships

• Employers: Danish companies drafting and enforcing these agreements to protect business interests, typically through HR or legal departments
• Key Employees: Senior managers, sales representatives, and technical specialists who must sign these agreements as part of their employment terms
• Legal Counsel: Attorneys who draft, review, and ensure agreements comply with Danish employment law requirements
• HR Managers: Responsible for implementing and managing these agreements within the organization's employment processes
• Courts: Danish labor courts that interpret and enforce these agreements when disputes arise

• Role Assessment: Identify specific business interests needing protection and the employee's access to sensitive information
• Geographic Scope: Define the exact regions where competitive restrictions will apply
• Compensation Planning: Calculate the mandatory 40% minimum compensation for the restriction period
• Time Limits: Determine restriction duration, keeping within Danish law's 12-month maximum
• Document Generation: Use our platform to create a legally compliant agreement that includes all required elements
• Review Details: Double-check employee details, specific restrictions, and compensation terms before finalizing

• Party Details: Full legal names and addresses of both employer and employee
• Scope Definition: Clear description of restricted activities and geographic boundaries
• Duration Clause: Specific time period, not exceeding 12 months under Danish law
• Compensation Terms: Detailed payment structure meeting the 40% minimum requirement
• Business Interests: Specific description of legitimate interests being protected
• Notice Periods: Clear timelines for when restrictions take effect
• Termination Rights: Conditions under which either party can end the agreement
• Governing Law: Explicit reference to Danish employment law compliance

A Restrictive Covenant Agreement differs significantly from a Confidentiality Agreement in several key ways, though both protect business interests. While they may seem similar at first, understanding their distinct purposes helps choose the right tool for your situation.

• Scope of Protection: Restrictive covenants prevent competitive activities and client solicitation after employment ends, while confidentiality agreements focus solely on protecting sensitive information
• Compensation Requirements: Danish law requires payment of at least 40% salary during restriction periods for covenant agreements, but confidentiality agreements typically don't require ongoing compensation
• Duration Limits: Restrictive covenants are limited to 12 months in Denmark, while confidentiality obligations can extend indefinitely
• Enforcement Focus: Covenants restrict future employment activities, while confidentiality agreements primarily protect information regardless of where the person works