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Restrictive Covenants

When you choose to leave your current employer, you will likely want to take the client or supplier relationships you’ve spent time building and nurturing with you to your new job. 

As an employee choosing to move to work for a competitor, your knowledge of the business’s clients along with its strategic plans and the technology it uses is invaluable both to the company you’re leaving and to your new employer. For these reasons, it’s likely that your former employer will want to protect its interests and intangible assets.

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Restrictive Covenants

Depending on your seniority, it is likely at some stage that you will have been asked to sign a restrictive covenant to limit some of your activity when you move. Such restrictions are normally provided to you in your initial contract of employment or in an updated contract upon gaining promotion within the business.

There are different types of restrictive covenants or preventative measures that you may have signed up to. These restrictions may;

  1. Prevent you from working in a similar role for a competitor

  2. Prevent you from acting for a client of your former employer, regardless of who approached whom

  3. Prevent you from trying to poach clients of your former employer

  4. Prevent you from trying to poach your former colleagues

For a restrictive covenant to be enforceable, it must be specific and reasonable. We regularly work with employees to negotiate the parameters of a restrictive covenant in order to allow you to bring the legacy you’ve built and the networks you’ve nurtured throughout your career to your new job.

While the courts look unfavourably on anti-competition clauses, it is important to note that such restrictions are enforceable if your former employer can evidence that they are in place to protect business interests and not, simply, to prevent competition.

Our Employment lawyers are skilled in arguing against restrictive covenants and will help you to understand what is reasonable and what can make restrictions unenforceable. We will advise you on your restrictions and any liability you may face should you breach such restrictions.

Whether you need assistance in negotiating the parameters of a restrictive covenant with your former employer, or you need to defend an allegation of breaching a restrictive covenant, our employment lawyers are able to advise you on the next steps in your career path.

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