Quant Hedge Fund PR Staffer Faces Two-Year Non-Compete; Lawyers Question Need

A public relations staff member who left a quantitative private fund manager with more than RMB 10 billion in assets was required to observe a two-year non-compete restriction, a case that has sparked discussion in the quantitative private fund industry. The firm achieved consecutive tier jumps in scale in the first two quarters of 2026. The departing employee in the relevant role was required to comply with a two-year non-compete period.

Quantitative private fund managers typically require employees to sign labor contracts, non-compete agreements and confidentiality agreements upon joining. At departure, the firm decides whether to activate the non-compete clause based on the employee's work situation. Non-compete terms do not exceed 24 months. For investment and research roles, the maximum non-compete period is usually two years, while for non-investment roles such as public relations it is generally one year. Previously, a public relations staff member who left a quantitative private fund in Shanghai was subject to a 12-month non-compete restriction, and a person in a corresponding role who left a quantitative private fund in Beijing was also subject to a 12-month restriction.

Under Articles 23 and 24 of the Labor Contract Law, employers may agree on non-compete restrictions with senior managers, senior technical personnel and other personnel with confidentiality obligations. The 2025 Judicial Interpretation (II) on Labor Disputes provides that non-compete restrictions should be reviewed under a framework of "specific secret, actual exposure, competitive risk and proportionality limits." If a worker has not been exposed to trade secrets or related confidential matters, the non-compete clause does not take effect; even if the worker has been exposed, the scope and duration of the non-compete restriction must be commensurate with the content and validity period of the trade secret. Non-compete restrictions protect an employer's trade secrets and intellectual property-related confidential matters, with the aim of preventing workers from using these specific secrets to create an unfair competitive advantage for competitors.