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Ben Jones
Ben Jones, UK Lawyer
Category: Law
Satisfied Customers: 44867
Experience:  Qualified Solicitor - Please start your question with 'For Ben Jones'
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I run a cake business in London. One of my employees (a pastry

Customer Question

I run a cake business in London. One of my employees (a pastry chef/cake decorator) handed in her notice suddenly a week ago. She claimed that she was going to work for her friend who was setting up a restaurant and also help her mother a few days a week with her cake business in Nottingham which had apparently suddenly got very busy. I found this very suspicious and a simple search on company check clarified that she has set up a London based cake business similar to mine with similar products. I found a website holding page, a facebook page and an instagram account - to which I might add she has blocked me from viewing. In her employment contract which she did not sign but is still binding, it has the following clauses
Conflict of Interest
31. During the term of the Employee's active employment with the Employer, it is understood and agreed that any business opportunity relating to or similar to the Employer's actual or reasonably anticipated business opportunities (with the exception of personal investments in less than 5% of the equity of a business, investments in established family businesses, real estate, or investments in stocks and bonds traded on public stock exchanges) coming to the attention of the Employee, is an opportunity belonging to the Employer. Therefore, the Employee will advise the Employer of the opportunity and cannot pursue the opportunity, directly or indirectly, without the written consent of the Employer, which consent will not be unreasonably withheld.
32. During the term of the Employee's active employment with the Employer, the Employee will not, directly or indirectly, engage or participate in any other business activities that the Employer, in its reasonable discretion, determines to be in conflict with the best interests of the Employer without the written consent of the Employer, which consent will not be unreasonably withheld.
Non-Competition
33. The Employee agrees that during the Employee's term of active employment with the Employer and for a period of six (6) months after the end of that term, the Employee will not, directly or indirectly, as employee, owner, sole proprietor, partner, director, member, consultant, agent, founder, co-venturer or otherwise, solely or jointly with others engage in any business that is in competition with the business of the Employer within any geographic area in which the Employer conducts its business, or give advice or lend credit, money or the Employee's reputation to any natural person or business entity engaged in a competing business in any geographic area in which the Employer conducts its business.
Non-Solicitation
34. The Employee understands and agrees that any attempt on the part of the Employee to induce other employees or contractors to leave the Employer's employ, or any effort by the Employee to interfere with the Employer's relationship with its other employees and contractors would be harmful and damaging to the Employer. The Employee agrees that during the Employee's term of employment with the Employer and for a period of two (2) years after the end of that term, the Employee will not in any way, directly or indirectly:
a. Induce or attempt to induce any employee or contractor of the Employer to quit employment or retainer with the Employer;
b. Otherwise interfere with or disrupt the Employer's relationship with its employees and contractors;
c. Discuss employment opportunities or provide information about competitive employment to any of the Employer's employees or contractors; or
d. Solicit, entice, or hire away any employee or contractor of the Employer for the purpose of an employment opportunity that is in competition with the Employer.
35. This non-solicitation obligation as described in this section will be limited to employees or contractors who were employees or contractors of the Employer during the period that the Employee was employed by the Employer.
36. During the term of the Employee's active employment with the Employer, and for two (2) years thereafter, the Employee will not divert or attempt to divert from the Employer any business the Employer had enjoyed, solicited, or attempted to solicit, from its customers, prior to termination or expiration, as the case may be, of the Employee's employment with the Employer.
I am wondering what I can do. Her business is set up in London in the same cachement area as myself and with her knowledge of my business and what I do she could easily try to steal my customers.
Submitted: 1 year ago.
Category: Law
Expert:  Ben Jones replied 1 year ago.
Hello, my name is***** am a solicitor on this site and it is my pleasure to assist you with your question today. How do you define the geographical area you conduct business in?
Customer: replied 1 year ago.
Hi BenApologies I did't get an email to say you had responded so just logged in to check.Basically my company covers the whole of London, we get orders from all over London and deliver all over. We also deliver UK wide. We are one of the best known cake companies in London. We're an online business not a shop so we are not defined by our location. However our bakery where our production is based is in London Fields Hackney, this employee lives in Finsbury Park which is only 3 miles away. Although I am not sure whether she intends to do it from home or elsewhere but she has called it Pastry Girls London.
Expert:  Ben Jones replied 1 year ago.
Hi there, post-termination restrictive covenants are a rather common occurrence in employment relationships. An employer would want to protect their business from a departing employee's knowledge, business connections, influence over remaining staff, etc. However, a covenant that restricts an employee's post-termination activities will be automatically unenforceable for being in restraint of trade, unless the employer can show that it was there to protect a legitimate business interest and did so in a reasonable way. Legitimate business interests (LBIs) are commonly accepted to include:· Goodwill (including supplier and customer connections)· Trade secrets and confidential information· Stability of the workforce An employer cannot apply a restrictive covenant just to stop someone competing with their business, but it can seek to stop that person using or damaging their LBIs by using a reasonably drafted covenant. Non-competition covenants, such as the ones here, 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. You say you cover the whole of London and many part of the UK but the geographical area in the contract is not defined. That makes it very general and would create difficulties in enforcing it as it is not specified to a reasonable and narrow-enough area. 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. Before you jump to legal action I suggest you try and resolve this by making direct contact with the person and reminding them of their restrictions and even threaten to sue them. They may consider their options if they are faced with the threat of legal action, but if you are considering going to court, think carefully about the risks and that no successful outcome is ever guaranteed. I trust this has answered your query. I would be grateful if you could please take a second to leave a positive rating (selecting 3, 4 or 5 starts at the top of the page). If for any reason you are unhappy with my response or if you need me to clarify anything before you go - please get back to me on here and I will assist further as best as I can. Thank you
Expert:  Ben Jones replied 1 year ago.
Hello, I see you have read my response to your query. Please let me know if this has answered your original question or if you need me to clarify anything else for you in relation to this? If your query has been dealt with please take a second to leave a positive rating by selecting 3, 4 or 5 starts from the top of the page. If you need further help please get back to me on here and I will assist as best as I can. Thank you.

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