Urgent Help - Contract of eomployment

diya_2

Hi everyone...need ur help nd advise..

I have been working for a company for the last 4.5 years.. and none of the employees were provided with any written contracts...its a small firm of about 5 people working, including the boss...

Now suddenly, the management has come up with a contract..which is totally unfair ( I and other employees feel )....

And the written contract has not been given to everyone..is this OK..If they come with a contract, well it should be for everyone....

Also, on the contract, it says 12 months after termination of my employment, I should not do business of any with any firm that the current company has been dealing with ...

And also...that the employee will not work within 5 miles for the period of 12 months and will not work for any business of the same kind....

So does this mean that after my termination, i need to seek a new career????

Can someone pls help on the above...

mny thnks

briona

diya wrote: »

Also, on the contract, it says 12 months after termination of my employment, I should not do business of any with any firm that the current company has been dealing with ...

And also...that the employee will not work within 5 miles for the period of 12 months and will not work for any business of the same kind...

Above all, a contract has to be fair, both to the employer and the employee. The highlighted points above show this contract to be far from fair – and by virtue of that it would be unenforceable.

An ex-employer cannot tell you who you can and can't work for. I'm a Graphic Designer, and obviously I will be employed by similar organisations each time I change jobs – putting restrictions on me would limit my options, prevent me from making a living and more than likely stall my career. No court would deem that as being fair, and hence that clause would become unenforceable.

Similarly you have a right to work where you want. Perhaps you need to stay in the area for childcare or family reasons. Perhaps you can't drive. Perhaps you have mobility problems... Once again, telling you you can't work in a particular area would not be considered fair – I do not see how this could be enforced. Or why they would insist on it. They are a company, you are an individual – you're never going to be realistic competition for them which makes this point even harder to enforce! They haven't got a leg to stand on!

Re. the clients, you could not actively seek to steal customers from your current employer but as customers are within rights to choose whom they do business with they could approach you.

I would seek to get legal advice on the contract but overall I wouldn't be too worried – I don't see how one iota of their contract would be enforceable!

Briona

Kimitatsu

The first clause is quite a standard one and has previously been upheld by a court of law so the precedent is already there.

The second one though? That seems unfair to me too, and also fairly pointless as if you are in a large city 5 miles is nothing. I would seek legal advice as to the legality of this clause.

I would seek advice before signing it though as it may be enforceble and would be legally binding at that point.

Maxjessdru

The only way this could be challenged is through the courts/tribunals. These clauses are known as restrictive covenants and may be enforceable depending on the business you are in/seniority. These types of clauses are more common in senior employee's contracts and the length of time/geographic area would be dependent on the business. If you did leave the company and went to work for a competitor, the company could apply for an injunction to stop you working for a competitor or for using any "confidential information" of theirs to the advantage of the competitor. However, the clauses cannot be too restrictive, ie, they cannot stop you from working at all and a court would look at all the circumstances to decide whether the clauses are enforceable or not. The court would not be able to amend the clauses, however, ie they could not decide that 3 months would be fair and 12 months would not - the clauses would either be enforceable or not.

pinkshoes

My previous contract stated that I was not permitted to work for any competitor for 12 months after leaving, which I thought was fair enough (as I could have given lots of their company secrets away!).

This 5 mile thing sounds ridiculous, and would never stand up in court!

What sort of work do you do, and are there many companies that do exactly the same thing, particularly in your area?

cazziebo

You would be better to seek advice from ACAS.

These restrictive covenants are reasonably common, and the norm in some industries. They are enforceable - however, very often the ex employer decides not to pursue because it's not worth the bother.

Whether it's fair or not depends on the situation and the circumstances. The company has the right to protect its business, but the employee can not be prevented from working.

12 months is pretty standard, and the mile limit is standard in some sectors eg hairdressing where you could "poach" customers. I think some law firms impose limits in more rural areas.

As Kimitatsu says, once signed you're bound to it so take professional advice before signing. Just because it's difficult to enforce doesn't mean it's not enforceable.

diya_2

pinkshoes wrote: »

My previous contract stated that I was not permitted to work for any competitor for 12 months after leaving, which I thought was fair enough (as I could have given lots of their company secrets away!).

This 5 mile thing sounds ridiculous, and would never stand up in court!

What sort of work do you do, and are there many companies that do exactly the same thing, particularly in your area?

I work as a travel consultant..

Is it fair that the company is giving contracts to only a few and not to everyone..keeping in mind that no one had any written contract earlier...

SomeBozo

Hello diya

And the written contract has not been given to everyone..is this OK..If they come with a contract, well it should be for everyone....

No, its quite ok to give different contracts to different employees.

Also, on the contract, it says 12 months after termination of my employment, I should not do business of any with any firm that the current company has been dealing with ...

And also...that the employee will not work within 5 miles for the period of 12 months and will not work for any business of the same kind....

As far as I am aware, these clauses are unenforceable.

However Kimitatsu says :

The first clause is quite a standard one and has previously been upheld by a court of law so the precedent is already there.

which is news to me! Fortunatly I pay lots of money to my staff to know the score, so I would really be interested in the case details of this?

Bozo

SomeBozo

We never had any written contracts..none of us.... and now they come up with a written contract...but not to everyone...so its not different contracts...but contracts only for a few....

Still can't see a problem.

With no contract, the status quo applies. Those given a contract might be abusing something that needs clear written instruction.

Unless you want to elaborate?

Bozo

diya_2

We never had any written contracts..none of us.... and now they come up with a written contract...but not to everyone...so its not different contracts...but contracts only for a few....

SomeBozo

I somehow managed to post a reponse to your post, before you posted yours!