Restrictive Covenants, Employee Mobility & Trade Secrets in Bangladesh

by Barrister Tahmidur Rahman | Sep 13, 2026

Private Client & EmploymentProtecting people, clients and know-how8 min read

Restrictive Covenants, Employee Mobility & Trade Secrets in Bangladesh

Restrictive covenants, confidentiality and trade secret protection for employers in Bangladesh: we draft clauses that courts are likely to enforce, manage senior departures and team moves, investigate data leaks, and seek urgent injunctions when employees or competitors misuse confidential information or client relationships.

Restrictive Covenants, Employee Mobility & Trade Secrets in Bangladesh: Restrictive covenants with TRW & Co
Matter planPrivate Client & Employment
  1. Map what needs protecting
  2. Draft and implement
  3. Respond to departures
  4. Enforce where necessary
Overview

How restrictive covenants and trade secrets are treated in Bangladesh

Restrictive covenants in Bangladesh must be drafted against a strict rule. Section 27 of the Contract Act 1872 makes void any agreement by which anyone is restrained from exercising a lawful profession, trade or business, subject to a limited exception for the sale of goodwill. Courts across the subcontinent have applied this rule to employment contracts for decades, generally upholding restraints that operate during employment but refusing to enforce broad post-employment non-compete clauses. Our employment and private client lawyers help employers protect their business with clauses and practices that are realistic under this framework. Clauses must protect a legitimate interest.

The practical consequence is that the employer's strongest protections are usually not non-compete clauses. Confidentiality obligations, which can continue after employment ends, protect genuine trade secrets and confidential business information. Notice periods and garden leave keep a departing employee away from clients and competitors while still employed and paid. Carefully limited non-solicitation and non-dealing clauses may help where they protect confidential information and relationships rather than simply preventing competition, although their enforceability is less settled. Intellectual property clauses secure ownership of software, designs and other work created during employment. Layered restrictive covenants work far better than one broad restraint.

Trade secrets have no dedicated statute in Bangladesh, so protection rests on contract, the equitable duty of confidence, and specific legislation where it applies. The Copyright Act 2023 protects software, databases and other works, trademarks and designs have their own regimes, and unauthorised access to computer systems may engage cyber security legislation and the Penal Code. Customer and employee lists containing personal data are also governed by the Personal Data Protection Act 2026. Our technology and IP lawyers work alongside our employment team so that these protections operate together rather than in isolation. Restrictive covenants are one layer.

When a senior employee resigns to join a competitor, or a whole team moves, speed matters. The employer must decide quickly whether to enforce notice and garden leave, recover devices and documents, review system logs and email activity, and send warning letters to the employee and the new employer. Where there is evidence of misuse of confidential information, the civil courts can grant temporary and permanent injunctions under the Specific Relief Act 1877 and the Code of Civil Procedure. Adv Syed Wahid, our founding partner, leads urgent applications, and our wider dispute resolution team handles any trial.

Restrictive covenants also arise outside ordinary employment. Sellers of businesses can agree not to compete within reasonable limits under the goodwill exception, shareholders' agreements often contain non-compete and non-solicitation undertakings, and incentive plans may make awards conditional on protective obligations. Competition law can also be relevant where competitors agree not to hire each other's staff. Barrister Tahmidur Rahman and Barrister Remura Meheruba Mahbub advise on these provisions in investments, acquisitions and joint ventures, and we coordinate with counsel in the UK, US, UAE, Singapore, China and India where group contracts are governed by foreign law.

01 · What we handle

Core workstreams

  • Drafting enforceable protections
  • Confidential information programmes
  • Managing senior departures
  • Team moves and poaching
02 · How it runs

Four clear stages

  1. 01Map what needs protecting
  2. 02Draft and implement
  3. 03Respond to departures
  4. 04Enforce where necessary
03 · Start here

Talk to a partner

Consultations in Dhaka or by video. Scope, team and fees are agreed in writing first.

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How we help

Our restrictive covenants and trade secrets work

Workstream 01Private Client & Employment

Drafting enforceable protections

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
Workstream 02Private Client & Employment

Confidential information programmes

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
Workstream 03Private Client & Employment

Managing senior departures

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
Workstream 04Private Client & Employment

Team moves and poaching

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
Workstream 05Private Client & Employment

Investigations and injunctions

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
Workstream 06Private Client & Employment

Transactions and shareholder covenants

  • Map what needs protecting
  • Draft and implement
  • Respond to departures
  • Enforce where necessary
01

Drafting enforceable protections

We draft confidentiality, intellectual property, notice, garden leave, non-solicitation and non-dealing clauses tailored to the role and the information the employee will see. For senior hires we prepare stand-alone protective agreements and policies, and we review global templates from head office so that restrictive covenants drafted for other jurisdictions are adapted to Bangladeshi law instead of being copied unchanged and left vulnerable. Templates are refreshed as case law develops.

02

Confidential information programmes

Courts protect information that the employer has actually treated as confidential. We help clients identify and classify their trade secrets, limit access, mark documents, control devices and cloud storage, and train staff. We also align these measures with the Personal Data Protection Act 2026, so that monitoring and access controls used to protect business information remain lawful and proportionate for employees. Restrictive covenants work best alongside these practical controls. Policies are written in plain English.

03

Managing senior departures

When a key employee resigns, we advise on notice and garden leave, return of property, exit interviews, reminders of continuing obligations, and communications with clients. Where there is a risk of data being taken, we coordinate forensic preservation of laptops, phones and email accounts. We aim to protect the business while avoiding steps that could expose the employer to claims of unfair treatment. Restrictive covenants are reviewed before the exit meeting, so managers know exactly what can be enforced.

04

Team moves and poaching

The departure of a team to a competitor can damage client relationships quickly. We advise employers facing team moves on contractual rights, evidence gathering and negotiated solutions, and advise hiring employers on how to recruit lawfully without inheriting liability for misuse of a former employer's information. We also consider whether arrangements between competitors about hiring could raise competition law concerns. Restrictive covenants rarely stop a team move alone, so evidence and negotiation matter. A hiring protocol should tell recruits not to bring documents or data from a former employer.

05

Investigations and injunctions

Where confidential information has been copied, emailed or downloaded, we investigate with forensic specialists, preserve evidence, send letters before action and, where justified, apply to the civil courts for temporary injunctions, delivery up of documents and restraint of further use. We also advise on criminal complaints where conduct involves theft, criminal breach of trust or unauthorised access to computer systems. Restrictive covenants and confidentiality claims are often pleaded together. Evidence handling is carefully documented.

06

Transactions and shareholder covenants

We draft and negotiate non-compete, non-solicitation and confidentiality undertakings in share and asset purchases, joint ventures and shareholders' agreements, using the goodwill exception and other legitimate grounds so that restrictive covenants in commercial deals are proportionate and enforceable. We also review covenants attached to incentive and share plans, including leaver provisions and forfeiture terms that may be challenged. Leaver terms are tested against likely scenarios.

RecognitionThe Legal 500Asia Pacific ranks Tahmidur Remura Wahid (TRW) Law Firm for dispute resolution in Bangladesh.
Cross-border reach6 jurisdictionsMatters coordinated with counsel in the UK, US, UAE, China, India and Singapore.
Bar and admissionsDhaka and LondonBarristers and advocates in Bangladesh, with a solicitor of England and Wales (non-practising).
HeadquartersDhakaHouse 410, Road 29, Mohakhali DOHS. Consultations in person or by video.
Who leads this work

Partner-led, on every matter.

Private Client & Employment matters at TRW are led by partners, supported by associates, with one responsible lawyer from first advice to final outcome.

Meet the firm →
01

Are post-employment non-compete clauses enforceable in Bangladesh?

Generally not. Section 27 of the Contract Act 1872 makes agreements in restraint of a lawful profession, trade or business void, and the courts, following long-standing subcontinental case law, have consistently declined to enforce non-compete clauses that bite after employment ends. Restraints during employment, including during a notice period, are treated differently and can be enforced. The practical message for employers is to rely on confidentiality, garden leave and other targeted protections rather than expecting a post-employment ban to hold. We redraft contracts accordingly and explain the realistic level of protection each clause offers.

02

What restrictive covenants can an employer realistically rely on?

Employers can generally rely on confidentiality obligations that continue after employment, intellectual property assignment clauses, restraints that apply during employment and notice periods, and garden leave provisions that keep an employee away from work while still employed and paid. Non-solicitation and non-dealing clauses aimed at protecting confidential client information may help, although their enforceability after employment is less certain and depends on drafting and facts. Together these restrictive covenants and practical controls give meaningful protection. We design packages proportionate to each role's access to sensitive information.

03

How does garden leave work under Bangladeshi employment contracts?

Garden leave allows the employer, during the notice period, to require the employee to stay away from work, clients and colleagues while continuing to receive full pay and benefits. Because the employee remains employed, restraints on working for a competitor during that period are generally enforceable. Garden leave must be provided for in the contract or agreed, and its length should match the notice period and the shelf life of the information concerned. For workers covered by the Labour Act, statutory notice rules must also be respected. We draft garden leave clauses and advise on using them.

04

What counts as a trade secret in Bangladesh?

There is no statutory definition, but courts generally protect information that is genuinely confidential, has commercial value and has been treated as confidential by its owner. Examples include formulas, manufacturing processes, source code, pricing models, tender strategies, supplier terms and unpublished business plans. Customer lists may qualify if they contain more than publicly available information. General skill and knowledge that an employee acquires on the job is not protected. We help employers identify what really qualifies, because protecting everything usually means protecting nothing in practice. Restrictive covenants cannot protect general know-how.

05

What should we do if a departing employee has taken confidential data?

Act quickly and carefully. Secure the employee's devices and accounts, preserve logs and email records, and avoid altering evidence. Instruct forensic specialists where data may have been downloaded or transferred. Send a letter to the employee, and where appropriate the new employer, demanding return and undertakings not to use the information. If undertakings are refused or evidence of misuse is strong, apply to the civil court for an injunction. We coordinate each step, from preservation to court, and advise whether a criminal complaint is also appropriate. Restrictive covenants matter less than speed here.

06

Can we stop employees soliciting our clients after they leave?

A clause preventing a former employee from soliciting clients with whom he or she dealt may be enforceable where it protects confidential information and client relationships rather than simply restricting competition, but the position in Bangladesh is not settled and courts may view broad clauses as void restraints. Narrowly drafted terms, limited in time and scope and linked to specific clients, stand the best chance. Confidentiality obligations protecting client data are often the stronger tool. We draft and review non-solicitation clauses with these limits in mind and explain the real level of protection.

07

Do restrictive covenants in a share sale follow the same rules?

Not entirely. Section 27 contains an exception allowing a person who sells the goodwill of a business to agree not to carry on a similar business within specified local limits, provided the limits are reasonable. This allows buyers of businesses to obtain meaningful non-compete protection from sellers in many cases. Covenants given by shareholders in joint ventures and shareholders' agreements require careful analysis of their purpose. We draft transaction covenants so that they are tied to the goodwill acquired and proportionate in duration, geography and scope. The sale agreement should identify the goodwill being sold.

08

Does the Personal Data Protection Act 2026 affect trade secret protection?

It affects both sides. Customer, supplier and employee information often includes personal data, so a departing employee who takes client lists may also be processing personal data unlawfully, which strengthens the employer's position. At the same time, employers protecting trade secrets through monitoring, data loss prevention tools and device searches must have a lawful basis, inform employees and act proportionately. We align confidentiality programmes with the Act, so that investigation evidence is admissible and the employer's own monitoring does not create a separate legal problem. Restrictive covenants must respect privacy too.

How a matter runs

From first call to resolution.

  1. 01

    Map what needs protecting

    We identify the roles, information, clients and know-how that matter most to the business, review existing contracts and policies, and assess which protections are likely to be enforceable in Bangladesh. Restrictive covenants are matched to real risks.

  2. 02

    Draft and implement

    We prepare tailored restrictive covenants, confidentiality and IP clauses, garden leave terms and policies, and help put access controls, training and exit procedures in place across the organisation. Managers receive short guidance notes.

  3. 03

    Respond to departures

    When key people leave, we advise on notice, garden leave, return of property and client communications, and coordinate evidence preservation where there is any risk of information being taken. Restrictive covenants are explained to the employee in writing. Client messaging is agreed in advance.

  4. 04

    Enforce where necessary

    Where misuse occurs, we send letters before action, negotiate undertakings and, if required, seek urgent injunctions and pursue the case to trial or settlement in the civil courts. Restrictive covenants are enforced proportionately. Settlement remains possible at every stage.

“Demonstrates an extraordinary command over both domestic litigation and international arbitration.”

The Legal 500 Asia Pacific, Bangladesh: Dispute resolution, client feedback

FAQ

Questions, answered.

Still unsure? Email info@trw.co with a short outline of the matter.

Should we still include restrictive covenants in contracts?
Yes, but with the right expectations. Well-drafted confidentiality, IP, notice and garden leave clauses are valuable, and even uncertain non-solicitation clauses can shape behaviour. Overly broad non-compete clauses add little and may undermine credibility with the court. We recommend a tailored set of protections for each level of seniority rather than one standard clause for everyone. Reviews every few years keep templates current. Senior hires deserve particular attention.
Do foreign law clauses help?
Group contracts sometimes choose English or another foreign law to obtain stronger non-compete protection. However, a Bangladeshi court asked to enforce a restraint against someone working in Bangladesh may still apply section 27 as a matter of public policy. Foreign law clauses can help in some situations, particularly with arbitration, but should not be relied on alone. We advise on the interaction carefully. Restrictive covenants under foreign law should be reviewed against Bangladeshi public policy before any enforcement step is taken. Arbitration clauses deserve separate review.
Can we withhold final dues if an employee breaches a covenant?
Statutory dues owed to workers under the Labour Act, such as wages and benefits, cannot simply be withheld as a penalty, and doing so can lead to a labour court claim. Contractual bonuses or incentive awards may be structured with conditions linked to protective obligations. We review final settlement and incentive terms so that any conditions are lawful and properly documented. Restrictive covenants linked to deferred incentives are often more effective in practice, because the employee has a clear financial reason to comply. Clear written terms avoid later argument about what was promised.
How long should confidentiality obligations last?
Confidentiality obligations can continue indefinitely for genuine trade secrets, but courts look more favourably on obligations that reflect how long information actually remains sensitive. Pricing and client data often lose value within months, while formulas or source code may remain valuable for years. We draft obligations that distinguish between types of information so that they are credible and enforceable. Restrictive covenants and confidentiality clauses should be reviewed together whenever a role changes or an employee is promoted. Definitions that cover all information, however trivial, are hard to enforce and weaken the employer's credibility.
Can a new employer be liable for misuse of our information?
A competitor that knowingly uses confidential information brought by a new recruit, or induces an employee to breach a contract, may face claims and injunctions alongside the employee. Writing to the new employer early often prompts it to impose its own safeguards. We advise both former and hiring employers on these risks and on practical protocols for onboarding senior hires from competitors. Restrictive covenants bind the employee, but the law of confidence can reach third parties who knowingly benefit from misuse. Onboarding declarations from new hires are a sensible safeguard.
What evidence do courts need for an injunction?
Courts generally need evidence that the information is confidential and valuable, that the defendant had access and is using or threatening to use it, and that damages would not be an adequate remedy. Forensic reports, emails, access logs and witness statements are often decisive. We prepare applications with clear, organised evidence, because the first hearing can determine the outcome of the dispute. Restrictive covenants in the contract help the court see what the parties agreed and what the employer regarded as sensitive. Delay can undermine an application.
Do restrictive covenants apply to consultants and contractors?
Consultants and contractors often have access to the same sensitive information as employees, so their agreements should contain confidentiality and IP terms. Section 27 applies to restraints in any contract, not only employment, so broad non-compete clauses face similar difficulties. We draft consultancy and outsourcing agreements with protections that match the access each party has to confidential material. Restrictive covenants for contractors should also address the conduct of their own staff and subcontractors. Return of materials at the end of an engagement should also be required.
How do we get urgent help?
Contact us through the contact page, call +880 1708 000660 or email info@trw.co, marking the message urgent. We will arrange an immediate call, advise on preserving evidence and protecting systems, and prepare letters or court applications as quickly as the facts and the evidence allow. Restrictive covenants questions that are not urgent can be handled through a scheduled review of your contracts and policies, agreed in scope before work begins.

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