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Ben Jones
Ben Jones, UK Lawyer
Category: Law
Satisfied Customers: 74331
Experience:  Qualified Solicitor
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I have been dismissed in my job. My contract states I cannot

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I have been dismissed in my job. My contract states I cannot work for competitors for6 months with no income. is this enforceable.
JA: Have you discussed the termination with a manager or HR? Or with a lawyer?
Customer: Not yet. Just wanted general guidance as there must be lots of precedents thank Pearl
JA: What is your employment status? Are you an employee, freelancer, consultant or contractor? Do you belong to a union?
Customer: employee. No Union. Should being in a Union make a difference
JA: Anything else you want the Lawyer to know before I connect you?
Customer: as I’ve no income will I be charged

Hello, I’m Ben, a UK lawyer and will be dealing with your case today. I may also need to ask some questions to determine the legal position.

Why have you been dismissed? How long have you worked there for? and what is the actual wording of the clause?

Customer: replied 1 year ago.
In error, admitted to employer, I gave a colleague a job advert that I had turned down
Customer: replied 1 year ago.
Ben. I have no income so cannot afford to pay.
I did pass the information
5 years
It states I cannot be employed by 6 named competitors when employment time terminateS
Customer: replied 1 year ago.
Please disconnect if you requirefurtherpayment

Don’t worry about the pop-up mentioning a phone call – this is an automatic offer made by the system, giving you the opportunity to pay extra to discuss things over the phone. However it is entirely optional, although I am not available for a phone call at present so if you just ignore it and close it down you will not be charged extra and we will just continue in writing at no extra cost.

In the meantime, leave it with me for now, although please note it is extremely busy at present due to the ongoing situation so there may be a delay in replying, but I will get back to you at some point today. Please do not reply in the meantime. Many thanks

Many thanks for your patience. It is a rather common occurrence for employment contracts to contain post-termination restrictive covenants. An employer would understandably 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:

{C}· Goodwill (trade connections with customers and suppliers)

{C}· Trade secrets and confidential information

{C}· 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.

When considering the most common types of restrictive covenant, these include:

1. Non-solicitation covenants – used to prevent an employee from enticing away their ex-employer’s customers. Solicitation generally means “directly or indirectly requesting, persuading or encouraging clients of the former employer to transfer their business ". There has to be a positive act by the employee such as to "tempt, lure or persuade” the client to do business with them. Situations where the client makes contact first are not automatically excluded and can still be caught under non-solicitation restrictions, although it would depend on the individual circumstances. Also it can be acceptable for departing employees to advise clients they are leaving and even leave contact details with them as that would not automatically amount to solicitation. Ideally, the covenant should be restricted to specific customers with whom the employee had contact during a specified period before leaving. Other relevant factors may include the employee's level of seniority in the business and the extent of their role in securing new business.

2. 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. If these covenants include a geographical area, their enforceability will also depend on the area they are trying to cover, such as density and population and what is considered reasonable in the circumstances.

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}· 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}· 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.

Does this answer your query?

Ben Jones and other Law Specialists are ready to help you
Customer: replied 1 year ago.
Ben. Just clarify. Yes or no are they enforcableon a sacked employee.

Just because someone has been dismissed does not automatically make such restrictions unenforceable – that is now what determines your position, it is the restrictions themselves and how reasonably drafted they are, according to the factors I mentioned above

Customer: replied 1 year ago.
Thanks.

All the best