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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 50209
Experience:  Qualified Employment Solicitor
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I have gone to work for a competitor from my previous

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I have gone to work for a competitor from my previous company, i have now received a solicitors letter with an undertaking asking me to leave or they will continue with proceedings. How serious is this, is this just scare tactics and if not how much could this cost me ?

Hello, my name is***** am a qualified lawyer and I will be assisting you with your question today.

How long ago did you leave your former employer and how long had you worked there for?

Customer: replied 1 month ago.
Hi Ben

Hi there. Please do provide the information requested so that I can look into this for you. Thank you

Customer: replied 1 month ago.
I handed in my resignation on the 17th January and was put on garden leave a week later. My last official date and the old company was on the 13th Feb. I started at my new company on 14th Feb
Customer: replied 1 month ago.
i had worked there for around a year and 9 months

OK, thank you for your response. Leave it with me for now and I will review the relevant information and laws and get back to you at the earliest opportunity. There is no need to wait here as you will receive an email when I have responded. Also, please do not respond to this message as it will just push your question to the back of the queue and you may experience unnecessary delays. Thank you.

Thanks for your patience. It is probably best to discuss the law on such restrictions first.

It is a rather common occurrence for employment contracts to contain post-termination restrictive covenants. An employer would understandable want to protect their business from a departing employee's knowledge of confidential information, business connections, influence over clients, suppliers, staff, etc. However, a covenant that restricts an employee's post-termination activities will be automatically unenforceable by 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.

The first thing to consider is what legitimate business interests (LBIs) can the employer try and protect? The most common ones are:

· Goodwill (trade connections with customers and suppliers)

· Trade secrets and confidential information

· Stability of the workforce (preventing poaching of employees)

If they are trying to protect an LBI, any relevant restriction must be drafted no wider than is reasonably necessary to protect that interest. Generally, the courts would try and balance the interests of the employer's business and the employee’s right to freedom of movement and to earn a living.

Non-competition covenants prevent an employee from working with a competing business or setting up to work in competition with their ex-employer. A covenant simply wishing to prevent competition will not be enforceable. However, a non-competition covenant trying to protect an LBI can be. Such covenants will generally only be 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. So if they have simply stopped you from working for a competitor, when you working there would have no impact on their business, it is unlikely to be enforceable. However, if you have a strong influence over clients which you may be able to entice, or know confidential details about the business which you can use in the new employment against them, that could also make it enforceable.

Whilst restrictive covenants are often used as a scare tactic by employers, if an employee has allegedly acted in breach of a covenant and the employer wants to take the matter further they can do so. The following legal remedies are available to employers:

{C}· {C}Injunction – this order of the court would seek to stop the employee from doing certain things that would make them in breach of the restrictive covenant, such as not to contact certain clients, not to use certain confidential information or not to work for a specific competitor

{C}· {C}Damages - compensation for loses which have directly resulted from the breach of the covenants, although it would only be possible if such losses are identifiable

In summary, there are various factors which deal with the reasonableness and enforceability of 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. In the end, only a court can decide if a covenant is legally enforceable so unless the employer goes to court and succeeds, they will only be able to rely on the employee’s own compliance with the restrictions. That is when the affected employee has to decide whether to do so or risk the employer taking this further.

I trust this has answered your query. Please take a second to leave a positive rating by selecting 3, 4 or 5 stars above - this is an important part of our process and recognises the time I have spent assisting you. If you still need me to clarify anything else, please reply on here and I will assist as best as I can. Thank you

Customer: replied 1 month ago.
Ok thank you. My role was as an account manager, however i did not deal with clients and wouldn't say there is any any i could loose the business money. My role was essentially to generate leads, and although i know the best way of doing this i wouldn't say this is trade secrets, as plenty of other companies are doing the same thing. The company is based online with sales people calling the leads generated, however the non compete clause has no geographical limit to it. would this potentially make it unenforceable?

Obviously no one can guarantee whether it would be enforceable or not until it goes to court but all of these factors would make it less likely that it is enforceable. Hope this clarifies?

Ben Jones and other Employment Law Specialists are ready to help you
Customer: replied 1 month ago.
thank you Ben.

you are welcome, all the best