The clauses
Non-solicitation and non-compete in IT services contracts across the EU
Your client wants to hire your developers. Your developers want to work for your client. What the contract can do about it, country by country.
14.1Client may directly engage any Supplier personnel who performed Services, without fee or restrictiononly during the Term and for twelve (12) months thereafter with Supplier’s prior written consent, or subject to a placement fee of 25% of the individual’s annual remuneration; this clause does not apply to hires resulting from a general public advertisement.
- Two different clauses get called the same thing: restraining your client from hiring your people, and restraining your people from competing.
- Client-side non-solicit is cheap and normal. Twelve to twenty-four months, mutual, with a public-advertisement exception.
- Contractor-side post-term non-compete needs paid compensation in Poland, Estonia and Germany. Usually not worth it.
Two clauses, one label
Ask a software house about its non-compete position and you will get two different answers depending on which side of the business they are thinking about. The clauses are unrelated and the law treats them very differently.
The first is a client-side non-solicitation: a term in your client MSA that stops the client hiring the developers who worked on their project. It is a business-to-business restraint between two companies, and it is generally enforceable on ordinary contract principles.
The second is a contractor-side non-compete: a term in your contractor or employment agreement that stops your own people working for a competitor or a client after they leave. That is a restraint on an individual’s ability to earn a living, and most EU systems regulate it tightly — typically by requiring you to pay for it.
Client-side non-solicitation: the market position
Enterprise templates often say nothing about hiring, which favours the buyer. When you raise it, the range of outcomes is narrow and well understood:
- Duration. Twelve months after the end of the engagement is the common position; twenty-four is achievable in long-term managed-service relationships where you have invested in a dedicated team.
- Mutuality. Make it mutual. It costs you almost nothing, it removes the “one-sided restraint” objection, and it occasionally helps you when a client’s own team is the target.
- Scope. Limit it to personnel who actually performed services for that client, and preferably to those who did so in the twelve months before the hire. A restraint covering your entire staff is the version that gets struck out or refused.
- The public-advertisement exception. Always concede this. Nobody can police a developer answering a job ad, and a clause that tries to looks unreasonable.
- The remedy. A placement fee of twenty to twenty-five per cent of first-year remuneration is the standard opening ask.
Expect resistance to the fee specifically. Large German and Nordic buyers frequently refuse it on internal-policy grounds, and public-sector-adjacent buyers may be unable to agree a penalty at all. When that happens, trade the fee for the restriction rather than losing both: keep the twelve months and the written-consent exception, drop the fee. You have then protected the team, which was the point.
Contractor-side non-compete, country by country
This is where copying an English-law template goes wrong. In England a reasonable post-term restraint needs no separate payment. Across most of the EU it does.
- Poland. For a B2B services contract, a post-term non-compete is enforceable only where the contract provides compensation for the restraint period. Case law has been consistent on this, and a clause with no compensation is simply unenforceable — a court will not read in a reasonable figure. A restraint operating during the contract needs no separate payment.
- Estonia. A post-contractual restraint must be in writing, limited in time, territory and subject matter, and compensated. Twelve months is the practical ceiling for a developer, and the compensation must be real rather than nominal.
- Germany. The strictest of the three for employees: a post-term non-compete requires Karenzentschädigung of at least half the employee’s most recent earnings for each year of the restraint, up to a maximum of two years. Get the compensation wrong and the clause may become voidable at the employee’s option — meaning they can choose to take the money or take the freedom, whichever suits them.
The common thread: a post-term non-compete is a product you buy, not a clause you draft. Price it before you include it. For a mid-level developer on a CEE rate, twelve months of compensation is a meaningful number, and most software houses conclude that the money is better spent on retention.
What to use instead
Three clauses together cover most of what a non-compete is supposed to protect, and none of them requires compensation in the jurisdictions above:
- Confidentiality, surviving termination, covering client information specifically as well as your own. Most of what you are afraid of losing is information, not the person.
- IP assignment with the fields of exploitation enumerated where Polish law applies, so the work stays with you regardless of where the author goes.
- Non-solicitation of clients and colleagues — a restraint on approaching your clients and recruiting your staff, rather than on working in the industry. This is a narrower restraint, is far easier to justify as protecting a legitimate interest, and in practice addresses the scenario that actually happens: a departing lead taking two colleagues and one account.
Drafting that survives
Whichever restraint you use, the same four choices decide whether it holds. Keep the duration short enough to be defensible — twelve months beats twenty-four in front of a court even where twenty-four is technically available. Define the restricted activity by reference to what the person actually did, not by industry sector. Limit the geography to where you genuinely compete, which for a remote-first business may mean naming clients rather than countries. And include a severability clause that lets a court reduce an over-wide restraint rather than delete it, which some systems will do and none will do if the contract forbids it.
One more practical point: put the restraint in the agreement that the individual actually signs. A non-solicit in your client MSA binds the client, not the developer. A restraint on the developer has to be in their own contract, with their own consideration, in their own language if that is what makes it enforceable locally.
Start commercially. A call that says “we noticed, here is the clause, here is what we propose” resolves most of these, because the client does not want a dispute over one hire and often did not check the contract before making the offer. Where the clause includes a fee, invoice it. Litigating a non-solicit is expensive, slow, and rarely recovers more than the fee would have.
The uncomfortable conclusion
Contractual restraints slow poaching down; they do not prevent it. The clause buys you notice, a conversation and sometimes a payment. What actually keeps a team together is the work, the rate and whether people want to stay — and a software house that relies on its paper for retention has a different problem than the one its lawyer can fix.
Draft the clause anyway. It is cheap, it is normal, and the one time a client hires three people off a project mid-delivery, you will want something to point at.
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