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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 45387
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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Hi, Please can you advise me on a contractual question. I

Resolved Question:

Hi,
Please can you advise me on a contractual question.
I joined my current business in 2006 and was issued a contract.
My role didnt change but in March 2013 I was issued a new contract which was broadly similar to the contract issued in 2006 with the exception that a large sub-section had been included surrounding post termination employment, and in particular referring to working for a competitor within 12 months of leaving the business.
I queried this at the time with my HR director and was told to "just sign it, you have no choice". No communication was made or dialogue exchanged to explain why this change had applied was there any consultation period between employer/employee. Nor was any compromise proposed if we were not to sign the contract.
I signed as instructed but voiced my disapproval.
I have been issued with another contract 1 month ago which is exactly the same as far as i can see as the one issued last year. I have not signed. I also have a job offer from a competitor.
Where do I stand? was the company within its rights to change my contract without consulatation or possible compromise? does the new contract supercede the old one, and by not signing do I have any rights? In your opinion, if i left to work for a competitor, how likely (given the above information) am I likely to be sued?
Thanks
James
Submitted: 2 years ago.
Category: Employment Law
Expert:  Ben Jones replied 2 years ago.

Ben Jones :

Hello, my name is XXXXX XXXXX it is my pleasure to assist you with your question today. How will you working for a competitor affect your current employer?

Customer:

Hi Ben,

Customer:

I am aware with current employee of costs of products and marketing plans etc. That would be seen as sensitive information

Customer:

I can attach the contract as a PDF.....have a look at section 15 etc if you wish

Ben Jones :

ok you can attach it on here if you wish, thanks

Customer:

Ben, it will only let me attach as an image and not a file....can email to you if you provide me with an address

Ben Jones :

it usually works as an image, I often work with pdfs on here

Customer:

im technically challenged then!

Ben Jones :

it's fine I got it

Customer:

section 15....is the new bit vs 2006

Ben Jones :

Generally when an employer wants to amend an employee’s contract, they need their consent or they could instead seek to terminate their current employment and re-employ them on the new terms. In this case you appear to have accepted the changes, albeit with a sense of reluctance. The issue is that you still signed the contract and started working under its terms without pursuing this formally, for example by making it clear you are not accepting the changes and that you are starting to work ‘under protest’. So whilst you may have expressed your dissatisfaction of the terms, you still accepted them and continued working as normal, which is unlikely to be seen as a clear refusal to agree to the changes.


 


So the likelihood is that the contract offered in 2013 has been accepted and even if they are trying to reissue you with a new, similar one, now, refusing it would still mean the previous version is in force.


 


In terms of the restrictions within, non-competition covenants prevent an employee from working with a competing business or setting up to work in competition with their ex-employer. Such general restrictions are seen as a restraint of trade and will be difficult to enforce. They will only be seen as reasonable if in the process of working in competition, the employee uses trade secrets or sensitive confidential information belonging to their ex-employer, or their influence over clients is so great that such a restriction is necessary. The length of the restriction and its geographical coverage will also be relevant. Legitimate business interests (LBIs) that employers are able to protect through restrictive covenants are commonly accepted to include:



  • Goodwill (including supplier and customer connections)

  • Trade secrets and confidential information

  • Stability of the workforce


 


Whilst restrictive covenants are mainly used as a scare tactic by employers, if an employee has acted in breach of a covenant and the employer is intent on pursuing the matter further they can do so. The following are potential outcomes if the employer takes legal action:



  • Obtain an interim injunction preventing the employee from doing certain things that would make them in breach of the restrictive covenant

  • Seek compensation for damages that have directly resulted from the breach of the covenants


 


As you can see there are no hard and fast rules on restrictive covenants. Whether a specific restriction is enforceable will always depend on the individual circumstances, the interest being protected and whether it has been reasonably drafted. The above principles are what the courts will consider when deciding whether a restriction is going to be legally enforceable. It should give you a good idea of what to look for in your situation and decide what the chances of this being pursued further are.


 

Customer:

Thanks Ben.

Customer:

As a US based company, I think the "scare tactics" are probably true. The company is risk averse and would not want to pusue anything through the court if it can be helped.

Ben Jones :

most companies are the same, but if they can foresee a genuine risk from your actions then it is there to be used if needed

Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 45387
Experience: Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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