Employment contract - Possible post termination restrictions

92203

Hi There,

I've received a new employment contract and there is some wording in it which concerns me ;

It is under a section concerning company confidentiality it has the following.

"You shalll not in any capacity whatsoever whilst being an employee pof the company and for a period of 12 months from termination of office, directly or indirectly wherher on your own behalf or on behalf of, or joinly with, any other person, firm, company or other entity

3. Carry out, engage, or accept employment in any business or trade which is competetive with any trade or business of the company

How should I interpret this? To me, it suggests that if/when I decide to leave, I am legally obliged to take a one year sabbatical. Am I reading this correctly?

Cheeky_Monkey

No you're not.

It basically means that you can't go and work for one of your company's competitors for 12 months after you leave

KiKi

Gosh, that's very broad, I'm not sure that would stand up in a court.

Personally, I would like to hope it means that you don't work for someone who's in direct competition (ie, you're not going to take their customers with you when you leave) BUT it's worded to such an extent (no employment with ANY business or trade that's potential competition to the company) that it could potentially prevent you from employment.

There are other more legal people who know much more than me on this, but I don't think this is necessarily enforceable - although it could depend on the industry you're in and where you're located. If this was O2, for example, and you're a phone engineer, then it would pretty much prevent you from employment with any mobile company in the UK which is entirely unreasonable. If you're a customer services person for a highly specialist facial botox company, then it would only prevent you working for a similar facial botox company, but you could get plenty of other customer services roles.

Can you give us an idea of the job / industry?

KiKi

92203

KiKi wrote: »

Can you give us an idea of the job / industry?

KiKi

Thanks, it's as a consultant for an IT Solutions provider. The job and company sound good, though that clause in the contract has got me very worried.

KiKi

I'd ask for written clarification. Clauses like these usually prevent you from working in *direct* competition in a certain area, but even some of those aren't enforceable.

As your role is specialist, it sounds like they don't want you sharing product and client information with direct competitors. To not allow you to work for ANY IT solutions company that may compete with them for 12 months sounds too restrictive. Are the IT solutions very narrow (ie, little competition) or are they fairly broad?

92203

Hi KiKi,

Thanks for your advice. I've penned a very pleasant and upbeat E-mail to them, just asking for a little more clarification. Dependent on what they come back with, I may actually ask them to remove, or at the very least amend the clause.

I'm in quite a fortunate position in that I'm very happy in my current job and work with nice people. I only embarked on this journey through being head hunted for this position. I'm in no hurry to leave my current employer, and in some ways feel reluctant to move company.

If this doesn't work out to my satisfaction, I will be staying put.

Thanks once again, and I'll pop back and let you know what happens.

92203

Owain_Moneysaver

I'm fairly confident that would not stand up in court.

any business or trade which is competetive with any trade or business of the company

doesn't limit the restriction to direct competitors of the company. It's far too wide-ranging to demonstrate that it's a reasonable restriction on trade.

Secondly and crucially there is no restriction on distance. Therefore the condition could apply world-wide, which is extremely unlikely to be accepted by the court.

I would not ask for clarification from the employer - that might alert them to reword the clause to a condition which would be enforceable.

In any case, if the company tried to enforce that condition they would only be entitled to damages if they could demonstrate actual loss.

Most clauses of this nature are put into contracts to frighten the employee and the employer knows full well it's actually unenforceable.

MataNui

Thats a standard term that they have copied from somewhere else. I have seen that exact wording in one of my old contracts. When it was applied to us it was added as part of some new terms and conditions we all had to sign up to. A couple of the guys got proper legal advise on it.

As others have said its too broad and as written is junk. They put these clauses in as broad statements hoping they can basically make the rules up later. Actually though what it does do is makes the section unenforceable.

HappyMJ

I'd ignore it. They might try and enforce it if you took customers away but you're not going to do that if you just happen to work for a competitor in a non-sales role.

As a consultant you should be required to keep any knowledge of the business to yourself and not share that in your next role. As long as you do that you'll be fine.

92203

Thanks for the replies guys,

They've removed it now and sent me a soft copy of the contract, signed by their HR manager.

Should I now just print it out (on my black and white printer) and post to them, or will they only be able to accept the version they've printed (in colour)?

I need to give notice to my current employer now. Dreading it as I am in the middle of a major project.

robatwork

92203 wrote: »

I need to give notice to my current employer now. Dreading it as I am in the middle of a major project.

So why not wait until the project is finished?
If you were head hunted then surely the new employer would wait for you. You obviously don't care much about your existing company or colleagues.