Confidentiality and Restrictive Covenants

It is important for both employees and employers to understand their rights in relation to restrictive covenants.  For an employee, understanding your contract and the enforceability of the restrictions will assist when moving employers.  Whilst for employers it is important to have well drafted contracts for your employees and understand the methods of enforcement available.

Employees may be subject to post termination restrictions flowing from their contracts.  This can include restraints in respect of the employer’s confidential information.

Post termination restrictions are a restraint of trade and are unenforceable if they go further than is reasonably necessary to protect the employers legitimate business interests.

Post termination restrictions normally fall into four categories:

• Restriction from solicitation
• Restriction from competition
• Restriction from dealing
• Restriction from poaching

In deciding whether the restrictions are enforceable the court will consider the justification and how narrow the restrictions are.  Factors to be considered include the geographical area of the restriction, the activities that are restricted and the type of interest being protected.

At Taylor Law we can assist in drafting contracts for employees to ensure that your business and trade secrets are protected as far as possible.  Only through suitable contract drafting are post termination restrictions likely to be effective, thus it is important for employers to get contracts drafted properly from the start.

With effective restrictive covenants former employees can be subject to claims for breach of contract and associated damages.  There is also the possibility of seeking injunctive relief to halt the continuing breaches by former employees.  This would be via an expedited hearing so that issues are resolved as quickly as possible to avoid ongoing losses.

Whether you are a business or an individual dealing with contracts and restrictive covenants, we can help. It is important to act quickly to in relation to enforcing restrictions.

Call us free on 0330 0539147 or email enquiries@taylorlaw.co.uk and we will be happy to help.