Concerning The Reasonable Standards Of Non-compertition Economic Compensation

In a time with frequent flow of human resources and increasingly fierce competition, it is possible that employees, if they were to engage in competing businesses with their former employers after leaving their jobs, would infringe on the trade secrets of their former employers and cause great losses thereto.Therefore, it is a practice for employers to enter into agreements with employees on restraint of competition, for the purpose of protecting trade secrets. Nevertheless, such agreements cut down employees'income, lowering their living standard.And above all, it has always been the primary object of the labor law to protect the legitimate rights of employees and to balance the interests of the employees and employers. Thus, it is fair to argue that employers should pay reasonable compensation to employees as a return for them performing the duty of restraint of competition with the employers. However, there is no specific provision about the standard of reasonable compensation in the Labor Contract Law, causing difficulties to judicial practice in this area. The author holds that in future process of legislation and judicial practice, "reasonable compensation" should be decided, by taking the wage income of employees as a base, above a minimum amount decided on the factors of area, scope and term of the duty of restraint on competition, and in accordance with the principle of "insuring the employee's living standard", taking into consideration of all factors relevant to the employee's original living standard.This thesis is divided into four parts:In the first part, the author identifies the problem of lack of regulation in current legal system on the standard of reasonable compensation for employees'duty of restraint on competition, through a classic case study.In the second part, the author distinguishes three different cases to see the Court of judicial practice how to determine a reasonable financial compensation for termination of non-competition, in the context that the entry into force of such agreements" is premised on the term "the employer should pay compensation to employees"In the third part, the author tries to define "wage income" in legal sense, by analyzing and comparing the connotation and denotation of "wage" and "labor remuneration" in both areas of labor economics and labor law, and to provide reasons for using "wage income" as the base for determining compensation for the duty of restraint on competition.In the last party, the author shows how the principle of "insuring the employee's living standard" is applied in judicial practice, through three typical cases and further discusses the legal basis for determining the standard of reasonable compensation.Being one of the many problems of the whole legal system on the duty of restraint on competition, the standard of reasonable compensation is fundamental, given its important role in balancing the interests of employers and employees.