Restrictive Covenants & Employment Contracts - Non-competition Clause

Can I stop an employee working for a competitor for 12 months?

The short answer is "No".

The usual way of trying to do this is by putting a restrictive covenant into the contract. However you need to be careful about the length of time you try to do this for.

The courts are not happy at any attempt to prevent someone from earning "an honest wage".

You need to work out whether there really would be a detriment to your business if someone set up in competition or went to a competitor - your customers are loyal, aren't they?  It's not so good when the ex employee steals your staff, but again, why were the staff interested in leaving?

A realistic time period for restricting activities is generally 6 months. Any longer and you take the risk of the court throwing the whole clause out and there being NO restriction at all.  As we live in a free-market economy, it is increasingly unlikely that the courts will continue to enforce non-competition clauses, and this will be restricted to highly specialised or niche professions. Although, that said, I can’t think what would be so specialised that it would warrant, outside of the Official Secrets Act and the professions covered by that, any ex-employee being prevented from exercising their right to earn a living.

The courts also tend to take the view that very senior management and specialists (pharmaceutical industry?) are the only ones who could possibly damage your business, and don't look kindly on you trying to restrict your marketing assistant from working for a competitor.

As with anything legal, think about whether you would even enforce it. If not, then you might as well leave it out of the contract.

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Call Carolyne now on 01491 699 550 or email NoRisk@GapHR.co.uk for the answers to your employee questions.