Restrictive Covenants in Employment Contracts
We provide proficient guidance on restrictive covenants in employment contracts
We can help you to protect your business against the threat of competition from your former employees through the use of post-termination restraints (also called restrictive covenants) that apply for a period after the end of their employment with you.
Such restraints typically prevent dealing with former customers or soliciting business from them or being involved in a competing business. They are often combined with provisions to protect your confidential information (such as customer databases) and intellectual property (IP). Nowadays, social media activity is often also covered.
Our experienced specialist employment solicitors have dealt with restrictive covenants in employment contracts and disputes over many years, so we have seen both sides of the issue. We know that careful drafting is needed for each agreement and that no two cases are alike. If the terms are too broad, the restraint may prove to be unenforceable if the Court decides it amounts to an unfair restraint of trade.
We also advise on contractual provisions when engaging directors or other senior people to ensure that appropriate restrictive covenants and confidentiality clauses are included. Where necessary, we can assist with the enforcement of such clauses and in resolving disputes which arise.
Get expert advice on restrictive covenants
Throughout, we work swiftly and incisively to obtain the most commercially advantageous results for you and your business. We can advise on:
- Drafting appropriate restrictive covenants in employment contracts
- Negotiating and drafting restrictions for exit or settlement agreements when employees leave your business
- Pursuing claims against former employees for breaching restrictive covenants
- Obtaining injunctions, including search orders, to identify and stop breaches or misuse of any confidential information by former employees
Work with industry-leading restrictive covenants lawyers
Our employment lawyers consistently appear in the directories of leading practitioners and are ranked by the leading client guides The Legal 500 and Chambers & Partners. This provides strong assurance that we offer an exceptional service.
The team is led by Joint Senior Partner Richard Gvero, who is closely supported by Associate Solicitor Miranda Mulligan. Both Richard and Miranda are individually recommended by The Legal 500 and Chambers & Partners.
Miranda and Richard are members of the Employment Lawyers Association (ELA), further emphasising their specialist expertise. Richard and Miranda are also accredited mediators.
Speak to our employment experts today
To discuss restrictive covenants in employment contracts with our solicitors, please get in touch.
Restrictive covenant FAQs
What are restrictive covenants?
Put simply, restrictive covenants can prevent an employee from competing with their previous employer after their employment with the business ends. These restrictive covenants will be clearly set out within the employee’s contract and last for a period of time after the end of employment.
What types of restrictive covenants are there?
There are different types of restrictive covenants that an employer can put in a contract of employment, which can include:
Confidential information – any information that belongs to an employer can be protected from a former employee, preventing them from misusing or disclosing that confidential information.
Non-solicitation/Non dealing – these restrictive covenants prohibit employees from persuading clients to move to a competing business or otherwise having dealings with them.
Non-poaching – this type of restrictive covenant prohibits an employee from approaching former colleagues and attempting to persuade them to join a competing business.
Non-competition – this sort of restrictive covenant prevents an employee from competing with their former employer’s business for a period of time.
Are restrictive covenants legal and enforceable?
Whether a restrictive covenant is legal and enforceable depends on how it was written into the contract of employment. The employer must also be able to demonstrate how the contract clause protects their legitimate interests.
The court will consider a number of aspects when asked to enforce a restrictive covenant, including:
- The length of the restrictive covenant
- Whether the restrictive covenant applies only locally, nationally, or globally
- Whether there was there a benefit in exchange for the restrictive covenant
- The seniority of the employee
When should employers include restrictive covenants in employment contracts?
If there are business interests at stake, such as confidential information or client relationships that needs to remain protected, and you are concerned that employees may misuse this information or relationship in the future, it would be wise to consider restrictive covenants in employment contracts.
Our fees for advice on restrictive covenants
Advice and guidance over employment law matters are extremely important and a wise investment for any business to make.
From the outset, we will always be entirely transparent about our fees, and we do this by providing a clear cost estimate. This could be a fixed fee where appropriate, providing complete assurance over what you are expected to pay.
To find out more about our restrictive covenants fees and to request an estimate of the expected costs, please get in touch with our solicitors.
Speak to our employment experts today
To discuss restrictive covenants in employment contracts with our employment lawyers, please get in touch.