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Restrictive Convenants

What do Restrictive Convenants look like in Employment Contracts?

Non-Competition Clause
This restriction is seeking to prevent you from working for a competitor in a similar role to the one you’ve held previously. It is generally put in place to stop you taking valuable and/or confidential information to another competing business for a certain period of time following the termination of your employment. Not only this, but it could also stop you setting up a similar business to the one you are already in or have just left.  However, in reality, these are one of the most difficult restrictive covenants to successfully enforce in a court of law.

Non-Solicitation Clause
Designed to keep your little black book of contacts closed – for a while at least – this blocks you from approaching your ex-employer’s clients or, in some cases, their prospective clients too. Usually, this is with specific reference to contacts you had direct dealings with for a certain period of time in the lead up to your termination date. After the time set aside for the restriction is up, there is not much your old employer can do unless you have deliberately removed confidential information and/or databases containing the details of these specific clients/prospects.

Non-Dealing Clause
Taking things up a notch from non-solicitation, this prevents you from dealing with previous clients, whether you actually make the first move and encourage them or not. Conversely, this can also be seen as ‘locking-in’ a client, as they legally can’t leave even if they look to follow you as a ‘trusted advisor’ to your new place of employment. Even if they approach you, the restriction would bite in the same way as it would by you directly soliciting them. However, (and again like non-competition clauses) these are often one of the hardest types of restrictive covenants to successfully enforce in a court of law.

Non-Poaching Clause
If an employer is worried about one departure starting a wider ‘exodus’, this clause aims to protect a company from staff following a departing employee . An employer will put this in your contract to prevent you from taking other key employees with you to your new business / employer.

Gardening Leave
For many, being offered this after handing in your notice is a dream scenario. A covenant placing you on gardening leave means that once you hand in your notice, your employer sees fit to prevent you coming to the office, makes you work from a different location or stops you from working full stop (while still paying you in full as well as often providing you with access to your normal employee benefits).

Read our most recent article on this here...

Are restrictive convenants enforceable?

Many candidates would admit that they don’t fully understand the legal ramifications of what it means to sign a contract bearing restrictive covenants. Whether these clauses are actually enforceable in a Court of Law however, will depend upon the circumstances of each individual case. In order to give you a greater understanding of restrictive covenants the following principles will usually be considered:
- Is the restrictive convenant reasonable?
- Does the restrictive convenant protect specific              legitimate business interests?
- What is your position in the business?
- Is breaking a restrive convenant worth the risk?

With non-compete restrictive covenants being currently under a wider Government microscope on Employment Law, it is very important for anyone considering leaving a business for another that they are aware of how these clauses could impact a move. Once you have signed a contract that is legally binding, and as the law relating to this stands, you could be held accountable in the event you have breached any enforceable restrictive covenant.. Know your rights, speak to legal representatives and don’t make any rash moves that could hurt you down the line.