Despite the economy remaining unsteady since the start of covid, it seems that many people are changing jobs at the moment.
When staff do leave, it is often the case that a restrictive covenant is in place which restricts them taking certain action or acting in a certain way. In this column, I’m going to focus specifically on non-compete clauses and discuss the importance of having them drafted well.
In Law by Design v Ali, the time period of a non-compete clause was disputed – with the claimant stating that 12 months was ‘too long’ and that 6 months would have been sufficient. Ultimately, the Court ruled that 12 months was a reasonable period for the covenant to last. The Court added it would have reasonably taken Law by Design a year to recruit and train a new staff member to the same standard as Ms Ali.
The case demonstrated that well drafted non-competition restrictive covenants can be enforceable, even if they last as long as this one. This is particularly the case when, as here, the outgoing employee has acted in what can be viewed as an underhand way and is going to potentially cause a significant loss to the employer they are leaving.
Employers should ensure that any non-competition clause is well drafted to reduce the likelihood of any claims and, if a claim does arise, reduce the probability of the claimant being successful.
At Frettens, our bright Employment Team can assist you in drafting a restrictive covenant or help you with any other Employment & HR related matter. We are pleased to offer all new clients a free initial chat. You can get in touch using the information below.
01202499255 | pburton@frettens.co.uk
This article is featured in the May issue of the Dorset Business Focus magazine. Read on the online version here.