On Non-compete Agreement Of Trade Secrets Theory

This dissertation is separated into three parts,which are the basic theories,the problems in practice of China and the conclusion.Among the three parts,the first part is about the current law and regulations and basic theories of trade secrets and post-employment restraint.And the recent US Defend Trade Secret Act and the amendment draft of Anti-Unfair Competition Law of China have also be mentioned.The second part makes detailed discussion about the relationship between post-employment restraint agreements and measures of keeping trade secrets,and how to deal with the conflict between the safety of trade secrets and the freedom of employees to choose their occupations.The focuses of the discussion are nature of post-employment restraint agreements and the balance between the interests of employers and employees.This part is the most important in this dissertation.Concerning the first problem,namely the relationship between post-employment restraint agreements and measures of keeping trade secrets,their similarities and differences,classification of the measures of keeping trade secrets and if an agreement is sufficient to be identified as a secret-keeping measure are the four perspectives in discussing this problem.From the perspective of the similarities,it appears that the purpose of making post-employment restraint agreements is to protect trade secrets and there may be concurrence of trade secrets protection and post-employment restraint when executing an agreement of post-employment restraint in practice.As for the differences,this dissertation lists the differences between these two legal relationships.Firstly,the nature:an agreement of post-employment restrain is a willful contract or agreement between the employer and employee,and the liability shall be taken is for breaching of contract;while the trade secrets are private properties of an employee,even if its independence and territoriality dissatisfy the traditional standard of IPR,therefore the liability shall be taken is based on infringement against private properties.Secondly,subjects who shall be liable are different:an agreement about post-employment restraint shall only binds its parties;while anyone who infringe the trade secrets shall be liable according to the nature of Intellectual properties.Thirdly,the way of dealing with disputes:the former disputes are usually settled by non-litigation ways before being submitted to courts,while the latter disputes are often settled by judges.Besides,me,asures of safeguarding trade secrets can be divided into subjective and objective,or as hardware and software,according to different standards.Then,considering the elements of measures safeguarding trade secrets are subjective will to keep secrets,the clear range about what can be protected as trade secrets and the degree of safeguard is proper,an agreement of post-employment restraint which is sufficient to be identified as a measure shall involve secret-keeping articles.The second practical problem,how to deal with the conflict between the safety of trade secrets and the freedom of employees to choose their occupations,is analyzed from three perspectives,which are the discrepancies between trade secrets and knowledge and skills,Inevitable Disclosure Doctrine in USA and its development in China and the way to judge an agreement of post-employment restraint is reasonable or not.When discussing the discrepancies between trade secrets of employers and knowledge and skills of employees,the opinions of the American and Japanese scholars and the China's patent law are cited,which is the knowledge and skills shall not be displayed by any other carriers except people.While trade secrets can be displayed by pictures,forms and so on.After introducing the development of Inevitable Disclosure Doctrine in America,the dissertation analyzes a Chinese case which "creatively" adapt the doctrine,and makes a conclusion that such doctrine shall be applied prudently in China to avoid being abused.Then two possible ways have been suggested.Particularly,when the doctrine is used,all conditions,including a signed agreement about keeping trade secrets,competitiveness between the two employers,similarity between the two occupations,knowingness of the employee about certain trade secrets and the honesty of the employee and latter employer shall be satisfied simultaneously.When judging whether a post-employment restraint agreement is proper,its term,district limits,industrial limits and compensatory payment shall be all taken into consideration.Specifically,the district limits shall be made in accordance with where the business of an employee locates will not cause any competition or conflicts with the employer's;the agreement will terminate when the relevant trade secrets cannot keep some advantage for its owner in competition;the restrained range of industries shall not be too large to make employees survive;the compensatory payment shall be paid for its nature is a consideration for fulfill the liabilities under a post-employment restraint agreement;and the classes of employees shall also be specified.One proper post-employment restraint agreement is able to maintain the advantage of an enterprise in its industry and also reduce the burden of proof of both parties in relevant disputes.Especially,when employees claim the the compensatory payment,it can be recognized as an important evidence by the court.The third part is final conclusion made based on theoretical and practical discussion in the first two parts.It also gives some suggestions from the standpoints of employees,employers and law-makers.For a company,post-employment restraint agreements used to safeguard the trade secrets are deemed as a reliable measure to keep its advantage in competition.When the employer and its employee did not make any agreement about this matter,the lawful obligations under the Company Law and Labor Contract Law can also make sense in protecting trade secrets.Besides,Inevitable Disclosure Doctrine from USA also functions as a way to keep trade secrets through limiting some kind of competing behaviors.However,it shall be applied prudently.For a worker,what need classifying are at least three things,which are who shall be restrained from certain industries and business when leaving from a company,what shall be protected as trade secrets under the name of the company,and what shall be excluded from trade secrets,namely the range of knowledge and skills owned by employees as parts of their personalities.For lawmakers,plenty of scholars advice to separate the legislation of trade secrets protection and prohibition of business strife system.