Non-competes in Egypt: How employers can protect business interests while remaining enforceable

As employers continue adapting to Egypt's Labour Law a year after its introduction, attention is increasingly turning from the headline reforms to the practical measures needed to protect business interests in a more flexible and mobile workforce.

In today's competitive business environment, organisations invest significant time and resources in developing client relationships, confidential know-how, business strategies and proprietary information. As remote working, workforce mobility and access to sensitive business information become increasingly common, it is unsurprising that employers continue to rely on restrictive covenants and confidentiality protections to safeguard these assets.

While Egypt's Labour Law (Law No. 14 of 2025) introduced a number of significant reforms, particularly in relation to modern working arrangements and workforce flexibility, employers continue to rely on established legal principles when seeking to restrict competitive activities following the termination of employment. At the same time, the new Labour Law reinforces the importance of protecting confidential information and business secrets, particularly as employees increasingly operate in flexible and remote working environments.

For employers, the challenge remains striking the right balance between protecting legitimate business interests and ensuring that any restrictions go no further than is reasonably necessary to achieve that objective.

When can employers use a non-compete clause?

Non-compete clauses are commonly used where the nature of an employee's role provides access to clients, commercially sensitive information or business secrets.

For many employers, the purpose of a non-compete is not simply to prevent an employee from joining a competitor. Rather, it is intended to protect legitimate commercial interests that could otherwise be exploited following the employee's departure.

Employers may therefore be more likely to consider post-termination restrictions for:

• Senior executives with access to strategic business information.
• Employees responsible for key client relationships.
• Individuals with knowledge of confidential pricing structures or commercial strategies.
• Employees involved in business development or market expansion initiatives.
• Personnel with access to trade secrets or proprietary information.

By contrast, broad restrictions may be more difficult to justify where an employee has limited access to confidential information or customer relationships.

The importance of proportionality

One of the key principles underpinning the enforceability of restrictive covenants is proportionality.

For a non-compete obligation to have the best prospect of enforcement, it should be carefully tailored to the particular risks presented by the employee's role. Employers should therefore consider whether the restriction is reasonable in relation to:

• The duration of the restriction.
• The geographical area covered.
• The activities that are restricted.
• The legitimate interests the employer is seeking to protect.

The broader and more restrictive a clause becomes, the greater the likelihood that it may be challenged.

For HR and legal teams, this serves as a useful reminder that restrictive covenants should not be applied on a "one-size-fits-all" basis across the workforce. Instead, restrictions should be tailored according to the employee's role, responsibilities and access to commercially sensitive information.

Courts will scrutinise broad restrictions

Courts generally seek to balance the employer's interest in protecting its business against the employee's ability to pursue future employment and earn a livelihood.

As a result, restrictions that extend beyond what is reasonably necessary to protect legitimate business interests may be difficult to enforce.

When considering whether a restriction is reasonable, factors that may be relevant include:

• The employee's role within the business.
• The information to which they had access.
• The extent of their client relationships.
• The duration of the restriction.
• The geographical scope of the restrictions.

Employers should therefore view non-compete clauses as a targeted risk management tool rather than a means of preventing competition more generally.

A written agreement remains essential

Clarity of drafting is critical. Any post-termination restrictions should be expressly documented within the employment contract or a separate agreement and should clearly identify:

• The activities that are restricted.
• The period for which the restriction applies.
• The geographical scope of the restriction.
• The business interests that require protection.

Ambiguity often creates uncertainty and can undermine enforceability. Carefully drafted provisions that address genuine business risks are generally more likely to withstand scrutiny than provisions drafted in broad or generic terms.

Confidentiality remains a critical protection

Employers should remember that non-compete clauses represent only one aspect of a broader business protection strategy.

The new Labour Law places considerable emphasis on the protection of confidential information. Employees are required to maintain the confidentiality of work secrets and confidential business information, while employees engaged in new forms of work may work for more than one employer provided they do not disclose work secrets. Articles 98, 134 and 136 also reinforce employee obligations regarding confidentiality and protection of employer information. 

This is particularly significant given the Labour Law's formal recognition of remote work, flexible work, part-time work and job-sharing arrangements. As employees increasingly work across multiple locations and, in certain circumstances, for multiple employers, the protection of confidential information becomes even more important. Articles 96 to 99 specifically regulate these new forms of work. 

Employers should therefore consider whether their employment documentation sufficiently addresses:

• Confidential information.
• Trade secrets.
• Intellectual property ownership.
• Data protection obligations.
• Customer and employee non-solicitation obligations.
• Remote working and information security requirements.

In many cases, robust confidentiality obligations can provide significant practical protection alongside any post-termination restrictions.

Practical steps for employers

As organisations review employment documentation in light of Egypt's new Labour Law, it may also be an appropriate opportunity to revisit existing restrictive covenant arrangements.

Employers may wish to:

• Review current non-compete provisions to ensure they remain proportionate and role-specific.
• Assess which categories of employees genuinely require post-termination restrictions.
• Update confidentiality and information protection provisions.
• Review remote working and information security policies.
• Ensure contracts clearly define confidential information and business secrets.
• Train managers and HR teams on the appropriate use of restrictive covenants.

A targeted and risk-based approach will often provide stronger protection than imposing broad restrictions across the workforce.

Looking ahead

Egypt's new Labour Law reflects the evolution of the modern workplace by introducing a framework for remote work, flexible working arrangements and other non-traditional forms of employment. As workforce models become more flexible, employers will need to place increasing focus on safeguarding confidential information, customer relationships and other legitimate business interests. 

While non-compete clauses remain an important component of that strategy, their effectiveness will continue to depend on careful drafting, proportionality and a clear connection between the restriction and the interests being protected.

Key takeaway for employers: Non-compete clauses can be an effective means of protecting legitimate business interests, but they should form part of a broader protection strategy that includes robust confidentiality obligations, information security measures and carefully drafted employment documentation. In practice, targeted and proportionate restrictions are more likely to provide meaningful protection than broad restrictions that attempt to prevent competition altogether.

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