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Ben Jones
Ben Jones, UK Lawyer
Category: Law
Satisfied Customers: 46761
Experience:  Qualified Solicitor - Please start your question with 'For Ben Jones'
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I received a letter from former employer's solicitor saying

Customer Question

I received a letter from former employer's solicitor saying I breach the clause of the contract that I'm having contacts with the client. I’m thinking to start the freelance contract with new employer from September to run social media platforms. One of their employee sent an email accidentally to my former work address saying ‘happy to start with u on 1st’ and that’s how my former employer found out everything. Apparently the new employer fits their definition of restrict client even though there’s no contracts or business happening between these two parties.
The solicitor was asking if I've been involved and I will be involved with the new employer. Even though it's a yes, can I still say no and make sure the new employer's on my side that will defend for me by saying no as well.
Submitted: 9 months ago.
Category: Law
Customer: replied 9 months ago.
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Customer: replied 9 months ago.
I've attached the letter from solicitor. I don't know how to respond the questions because I still want to work with the new employers. The solicitor asked me to reply by the end of this week. Can someone help me ASAP? thanks.
Expert:  Ben Jones replied 9 months ago.

Hello, my name is***** am a qualified lawyer and I will be assisting you with your question today. What is the business connection between the ex employer and the client - are they likely to be doing any business again soon? Will you working for them affect the employer in any way, will they lose business as a result?

Customer: replied 9 months ago.
i was doing business development in the previous company and came across with Ettinger.my boss knew that I went to see ettinger on behalf of Red lantern. Ettinger doesn't have the intention of working with my previous company and they didn't have any business relationships.
Expert:  Ben Jones replied 9 months ago.

Ok I would not suggest that you lie and try to cover up the fact that you may be working together as that has the potential of making things worse. As far as what you can do there are two separate issues here – one is the LinkedIn information (which you can resolve very quickly by doing as requested) and the other is your intention to work with this client. The best defence would be that the restrictions they are trying to enforce are not reasonable.

As far as the law stands, 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:

{C}· Goodwill (including supplier and customer connections)

{C}· Trade secrets and confidential information

{C}· 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. There are a few different types of restrictive covenants that can be applied, these being:

Non-dealing covenants are a wider restriction and not only restrict solicitation but any other general contact with clients. The enforceability of a non-dealing covenant will depend on the interest being protected and can be influenced by a substantial personal connection the employee enjoys with a specific client. However, such a covenant will not be enforceable if it prevents any sort of contact with the client. The restriction must be focused on the specific type of contact that would directly affect the employer's business. If there was no ongoing relationship between the employer and the client and unlikely for one to have formed, hen such restrictions are very difficult to enforce. By you going to work for them you are not directly affecting the employer’s business because you are not stealing a client from them so it is unlikely that such a restriction would stand up in court in the circumstances.

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:

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

{C}· 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. In this case, I believe they are rather low.

I hope this has answered your query. I would be grateful if you could please take a second to leave a positive rating (3, 4 or 5 stars) as that is an important part of our process and recognises the time I have spent assisting you. 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

Customer: replied 9 months ago.
Hi Ben, thank you so much for the answer. i do have some follow up questions. first do I need to get confirmation with the client Ettinger that they don't have any intentions of working with red lantern and we remain good connections? second, you mentioned 'By you going to work for them you are not directly affecting the employer’s business because you are not stealing a client from them', but how red lantern define restrict client is anyone i came across during my employment n not to mention that i went to do presentation on behalf of redlantern. am i not breaching the contract?
Customer: replied 9 months ago.
in your opinion, how shall i reply the solicitor? shall i use the words u sent me just now? or is it possible you can reply them on behalf of me?
Customer: replied 9 months ago.
in the letter the solicitor asked me list other restrict clients that i've been in touch with. there's actually one more. if i decide to hide it and make sure the client won't sell me out, is it possible for red lantern to sue me again just be cause they suspect I'm doing it for them? Do they have the power to check my email or bank account?
Customer: replied 9 months ago.
I've attached my contract here for your reference.
Customer: replied 9 months ago.
there's some financial transactions £400 going through to ettinger now. I'm just afraid if i defend myself by what you are saying and also insist that what i'm doing it not wrong and i will continue to do it. this will make the case bigger? n they might pursue the court? im very worried
Expert:  Ben Jones replied 9 months ago.

You do not need to get such confirmation but it can certainly help. Also it does not matter how they define a restricted client, they can include anyone they want but that does not mean it is fair and reasonable - remember the law only allows them to protect legitimate business interests, such as if you had used your influence over the client to make them leave the employer’s business or poach them and prevent them from taking them on as a client.

Unfortunately I cannot reply on your behalf as we are just a Q&A service so we are limited to talking online with you. But use something along the lines of what I said – state that the LnkedIn issues will be resolved but that you do not agree that they can apply this restriction as it is unreasonable and likely unenforceable in the circumstances die to the factors I mentioned.

You cannot be forced to declare other interests even if they may affect them – they cannot check your bank or emails anyway. If they go to court then they cannot only pursue you for actual losses they have suffered as a result – they cannot just penalise you. So if they have not lost a client or business because of this then no losses have been suffered so a claim is unlikely to affect you much.

If your original question has been answered I would be grateful if you could please quickly rate my answer by selecting 3, 4 or 5 starts at the top of the page - it only takes a second to do and is an important part of our process. I can still answer follow up questions afterwards if needed. Thank you

Ben Jones, UK Lawyer
Category: Law
Satisfied Customers: 46761
Experience: Qualified Solicitor - Please start your question with 'For Ben Jones'
Ben Jones and 2 other Law Specialists are ready to help you
Customer: replied 9 months ago.
Hi Ben, thanks for the answer. Is it possible to hire u personally to reply the letter? also before the issue resolves, can i work with the new employer? or better to wait before it resolves.
Customer: replied 9 months ago.
hi ben, after i rate you, how long can i still contact u?
Customer: replied 9 months ago.
hi Ben I rated you just now. Are you still there? Can you help me with the questions above? Thanks.
Expert:  Ben Jones replied 9 months ago.

Hi there, unfortunately as mentioned we cannot work for you outside of this site and I am limited to just discussing matters on here. If you need to engage a lawyer to help you then you must do so in person via the formal routes. I would say that at this stage it is probably unnecessary to engage a lawyer as it will get expensive at it may not be needed, but if they go ahead and make a claim you should then think about it

Customer: replied 9 months ago.
hi Ben, thanks for the advice. i asked another question above that can i start to work with this new employer without the issue's solved. from your experience, by seeing solicitor's letter, do you think it's a big issue or not? because i feel for now they are just warning me not to start to work with them and things might just go away. I'm just afraid if i start to defend for myself, in the meantime working with the new employer, they will exaggerate the loss which brings to the company business? if that's the case then probably i should just stop working with the new employer? i'm just not sure if the defense's going to be strong and powerful and make them step back or will piss them off to pursue further?
Customer: replied 9 months ago.
also for the payment, is it i can consult you till this case resolved? or there are days limitations. thanks.
Expert:  Ben Jones replied 9 months ago.

Yes you can start working for them even if the issues have not been resolved. I have seen many letters like this, as mentioned they are often used as a scare tactic. There is nothing stopping the employer from taking this further but they will have to pay court fees, solicitors fees and spend time dealing with this and if the potential returns are risky or not guaranteed, then it makes no sense. Of course I cannot promise that they will not take this further but based on the facts, I would be surprised if they do. And any losses must be justified - they cannot just pick a figure and claim it - they have to shoe that it is very likely such loss of business would have occurred and be able to show that it was as a result of your actions - not that easy in reality.

As to further advice, you have 7 days in which to ask short follow up questions for clarification but if it goes beyond that or you need more detailed help you would need to post a new question. Thanks

Customer: replied 9 months ago.
thank you so much Ben. You've been very helpful. I will let you know if there are any other questions. Thank you!
Expert:  Ben Jones replied 9 months ago.

You are welcome, all the best

Customer: replied 9 months ago.
hi ben, sorry to bother you again. if i decide to defend myself. what will be likely to happen for the employer? are they going to further argue with me that i did breach the contract and asking me to stop? or they are trying to get some compensations out of me? or they will go directly to the court?
Expert:  Ben Jones replied 9 months ago.

They cannot force you to do anything, be it stop working for the employer or pay them for loss of business, unless thy go to court and win. So they may try and threaten you and send you letters and so on but nothing can force you to do anything until they have been successful in court.

Customer: replied 9 months ago.
what evidence or documents do they need to obtain an interim interdict to stop me from working? is it easy to get the interim interdict? also the bottom line is that I'm still in breach of the contract or not? from your point of view, do u think it's worth defending myself or just quit? my family is very worried that i may end up in the court and paying tons of money.
Expert:  Ben Jones replied 9 months ago.

it is not easy to get, they must show that you are a serious threat to their business and must be stopped from what you are doing to preserve their business interests. If they did not have this person as a client and there was no likelihood of them becoming one then an injunction will be unlikely. Even if you are potentially in breach of contract that does not mean that they can just take action against you - a case for breach of contract is there to compensate the wronged party for losses incurred from the breach, which in this case are either non-existent or minimal.

Customer: replied 9 months ago.
also after i defend myself, if the employer argues back, is it still possible to negotiate the terms such as i stop working with them or pay them money? if it needs money to be solved, how much do you think will be reasonable based on the fact that i've been working in the company for 6 months and there's no ongoing relationships between the other two parties. if worst scenario that i'm sent to court, how much money will it estimate cost adding lawyer's fee?
Expert:  Ben Jones replied 9 months ago.

yes of course you can negotiate anything you and the employer are happy to agree on. I do not see this being resolved by paying money as they do not appear to have lost anything. I know you are worried but I do not see them having a strong case here and from experience such weak claims are very rarely taken further. If it goes to court then f they claim less than £10k which they should in this case you do not have to pay their legal fees even if you lose. If you want to use a lawyer it is up to you but you do not have to. If you do it depends on how much you use them, it could be a few hundred to a couple of thousand.

i am leaving the office now so won't be able to reply again until late today, thanks you

Customer: replied 9 months ago.
thank you very much Ben!!!! I can have a good sleep tonight. Will contact u further if any problems pop up. Have a nice evening.
Expert:  Ben Jones replied 9 months ago.

Thanks you too

Customer: replied 9 months ago.
hi Ben, I talked to my family again last night, we are wondering if there's any law against employee having contact with a potential client n will cause employer potential business loss? Is it possible if later on when they Pursue damage, they will ask for loadz of money bcz they r considered to be the potential loss? Is there any law about this 'potential' definitions or understanding? Thanks
Customer: replied 9 months ago.
Also is it possible for them to sue me that I become their competitor that I provide the same service my former employer does?
Customer: replied 9 months ago.
hi Ben, i just talked to another solicitor, she said i may argue that the restrict clients are too wide and the restrict period is too long, but if it's brought to the court, i did breach the contract. there's high risk to bring to the court and will cost me £30,000. and she said if she were me, she won't take the new job. I'm so scared...what are your thoughts on what she said?
Customer: replied 9 months ago.
Ben are you there? I'm sorry to bother you again. can you please get back to me regarding the questions above? thanks.
Expert:  Ben Jones replied 9 months ago.

There is no such law it is all governed by specific contractual restrictions. As mentioned you can indeed argue that the restrictions are unreasonable in the circumstances. I very much doubt it would cost £30,000 in this case and my opinion is still that the restrictions they are trying to enforce are too wide and restrictive so a court will be unlikely to enforce them. But I cannot tell you what to do - I cannot just tell you the law, the final decision is yours

Customer: replied 9 months ago.
yeh makes sense. thank you Ben. I sent solicitor the reply just now and wait to see their replies. thanks for your help! have a nice day.
Expert:  Ben Jones replied 9 months ago.

Many thanks

Customer: replied 9 months ago.
hi Ben, I just got the response from the solicitor. I've attached here.
Customer: replied 9 months ago.
Thanks for your email. I’ve changed my Linkedin profile as you requested.
In terms of the second part breaching the contract of contacting the prospective client G.Ettinger, I do not agree that Red Lantern Digital Media can apply this restriction as it is unreasonable and likely unenforceable in the circumstances due to the factors below.
As far as the law stands, 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.
LBIs are commonly accepted to include:
- Goodwill (including supplier and customer connections)
- Trade secrets and confidential information
- Stability of the workforce
I did not damage any of the legitimate business interest above. Furthermore, there was no ongoing relationship between Red Lantern and Ettinger and unlikely for one to have formed so there is no business or potential loss for Red Lantern, to apply a restrictive covenant is unreasonable.
Customer: replied 9 months ago.
above was my previous email and his response. from your point of view, do you still think it's a scare tactic because I'm quite scared now. he keeps asking me whether there's been service going through and if there are any other prospective clients involved. do i have the right not to answer it? I'm so panic again dont know what to do as he asked me to reply by monday. can you please help? thanks.
Expert:  Ben Jones replied 9 months ago.

I cannot tell you what their intentions are - only they know. I can only say that if they go to court and try to apply their rights to the full extent then this will be rather difficult because in the circumstances thy are on rather weak grounds to do so

Customer: replied 9 months ago.
hi Ben, may I ask regarding the questions they ask, is it my right not to answer all of them? if they keep pushing to ask me to answer, what's the best way to reply? thanks. have a nice weekend!
Expert:  Ben Jones replied 9 months ago.

You have the right not to answer any of the questions they ask. I cannot tell you how to reply to each question to be honest there is no blanket reply I can advise you to give so it depends on each question, what is being asked, what they know about the answer, what information you want to give them about it etc

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