Non-Compete Clause in Terms and Conditions of Employment

chaotic_j

Hi,

The company I work for sell purely online.

I have what appears to be a non-compete clause in my Terms and Conditions of Employment which basically says;

- You hereby covenant with the company that you will not for a period of three months after termination of employment directly or indirectly carry on or be engaged concerned or interested in business which shall be in competition with the company unless with express written permission of a director

What are the chances of this clause being legally enforceable?

It is only specific in the duration of the clause, obviously the company sell purely online but I don't think it would be considered reasonable to effectively restrict the whole of the UK etc? Which I believe is what they are doing by not mentioning a geographic radius.

Also, I'm just a regular employee I don't have any junior or senior position whatsoever.

Please let me know, thank you in advance

wapow

Competition law so it would be enforceable.

Raggie

Not a expert in this area... However having worked in many company's and a number of them have put non compete clauses in contracts I was under the impression it depends on what you do for the company.

For example if you have a specific skills set, and there are only a couple of companies at which you could use those skills then no non compete clause can be enforced as a companies terms of employment can not interfere with your rights for employment to earn a living.

On the other hand if you leave a company with their client list and immediately set up in competition with the company you just left then I believe they may have a case.

I guess what I am saying is it's not a simple yes/no answer

Rags

ohreally

"Even if a restrictive covenant is valid, an employer wishing to enforce such a clause will still have to show that a breach will do it some harm. In the case of Jack Allen (Sales & Service) Ltd v Smith [1999] IRLR 19, the Court of Session refused to enforce restrictive covenants because the employer had been unable to identify any real loss."

Denning.

ohreally wrote: »

"Even if a restrictive covenant is valid, an employer wishing to enforce such a clause will still have to show that a breach will do it some harm. In the case of Jack Allen (Sales & Service) Ltd v Smith [1999] IRLR 19, the Court of Session refused to enforce restrictive covenants because the employer had been unable to identify any real loss."

This. Contract law 101, you need to show a loss to sue for breach of contract.

wapow

Loss though could be classed as a loss of business/clients which in turn loss of sale revenue?

chaotic_j

Hi,

Thanks a lot for the replies; most appreciated.

To clarify a little; I'm interested in applying for a job at another company. The job(s) that I have done and would apply for, would exist at many, many companies.

They sell in the same sector as my current employer, albeit current employer is the 'big fish' and they are the 'minnow' so to speak.

The main supplier of the company I work for, they own - so it'd be highly doubtful the new company would be dealing with them..

I have thought about setting up my own company in competition with my employer, however to be completely safe I'm guessing it would be a case of leaving and sitting pretty for 3 months?

Does this help at all?

Thanks a lot.

wapow

chaotic_j wrote: »

Hi,

Thanks a lot for the replies; most appreciated.

To clarify a little; I'm interested in applying for a job at another company. The job(s) that I have done and would apply for, would exist at many, many companies.

They sell in the same sector as my current employer, albeit current employer is the 'big fish' and they are the 'minnow' so to speak.

The main supplier of the company I work for, they own - so it'd be highly doubtful the new company would be dealing with them..

I have thought about setting up my own company in competition with my employer, however to be completely safe I'm guessing it would be a case of leaving and sitting pretty for 3 months?

Does this help at all?

Thanks a lot.

Hmmm. It does muddy the water so to speak
3 months is nowt. It'll be July in the blink of an eye. Why not wait it out? Waiting would be the less hassle route. In the meantime you can plan all you want because you know what they say


You don't plan to fail, you failed to plan.
I'd join your business if you were going out on your own! :money: