Your Employer's Playbook: The Clauses Courts Are Starting to Reject

PUCKA Law 101 | Harvey Specter Jr.

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Three lawsuits landed on my desk this week that tell the same story from three different angles. A worker in Kentucky. A professor fighting a dean appointment. Thousands of employees across the United States whose contracts quietly forbade them from holding a second job, from discussing what happened to them at work, from comparing notes with a colleague over lunch. Different fact patterns, same mechanism: language written by one side, signed by the other, enforced by neither until someone decided to push back.

That last part is where it gets interesting.

The litigation surge around restrictive employment clauses is not a moral awakening. Courts do not have moral awakenings. What they have is precedent that accumulates slowly until one ruling tips the balance and suddenly every firm in the country is re-examining its standard contract. That tipping point is arriving now, and if you are an employee in Malta — or anywhere inside the European Union — you need to understand that the clauses your employer spent money drafting may be worth considerably less than the paper they were printed on.

Start with secondary employment restrictions. In the United States, the lawsuits proliferating right now target employer policies that prohibit workers from holding a second job entirely — not because the second job creates a conflict of interest, but because the employer simply doesn't want the competition for your time. Courts are distinguishing between those two things with increasing clarity. A restriction tied to a genuine conflict — you work for a bank and want to consult for a rival bank — has legal weight. A blanket prohibition on any outside income, tied to nothing except control, is increasingly being treated as an unreasonable restraint.

Maltese employment law, operating within the EU framework, already has architecture that limits how far an employer can reach into a worker's private life. Article 36 of the Employment and Industrial Relations Act draws a line between the employment relationship and the employee as a person. That line is not always enforced because employees don't know it exists. The clause in your contract that says "you shall not engage in any other professional activity during the term of this agreement" reads like law. It isn't, necessarily. Whether it holds depends on whether it can be justified by legitimate business interest, proportionate to that interest, and limited in scope. All three tests. Not one.

Then there are the silence clauses. Non-disclosure provisions that prohibit an employee from discussing not just proprietary information, but discrimination they experienced, harassment they witnessed, wage discrepancies they noticed. American courts are beginning to treat these as unenforceable on public policy grounds — you cannot contractually extinguish a person's right to report a crime or make a protected disclosure. The EU Whistleblower Protection Directive, which Malta transposed into national law through the Protection of the Whistleblower Act, goes further. It creates a positive protection regime, not just a shield. If your contract contains a clause that would effectively prevent you from making a protected disclosure, that clause may not just be unenforceable — it may expose your employer to liability for including it.

I have seen these clauses in Maltese employment contracts offered to junior professionals — clauses so broad they would prohibit the employee from mentioning their employer's name in a conversation without prior written consent. Drafted by someone who understood that most employees would never read them carefully, and those who did would assume the employer knew what was legal. Both assumptions served the employer.

Here is what those employees didn't know: the existence of a clause in a contract does not establish its legal validity. A contract is not a statute. It is an agreement between parties, and agreements have limits — limits imposed by law, by public policy, by the principle that one party cannot use superior bargaining power to strip the other of rights that exist independently of the agreement itself. The employer's lawyer spent €400 an hour drafting those clauses. The employee spent zero reading them. Neither of those facts determines what the clause is worth when challenged.

I had a client years before I understood how any of this worked — someone who signed a settlement agreement that included a clause preventing him from discussing the terms with anyone, including his own accountant, which meant he couldn't properly manage the tax implications of the payment he received. He had signed away access to professional advice about the very money he was being paid. That is what unchecked contract drafting looks like in practice. It is not always malicious. It is often just the result of one side having lawyers and the other side having a signature line and a deadline.

The practical architecture of the EU