restrictive covenants

Anyone who operates a successful business knows that it is vital to protect products, processes, and ideas in order to achieve continued success. Restrictive covenants within your employment contracts are an important tool at your disposal to protect the legitimate business interests. But to be enforceable, such covenants must be ‘reasonable’. Our employment lawyers are experts in careful, precise and bespoke contract drafting to ensure the courts will enforce these restrictions.

Why use restrictive covenants?

Restrictive covenants can be used to protect the business interests by preventing an employee from undertaking certain activities after they have left. Typically, these seek to prevent a former employee from using confidential information and trade secrets, soliciting clients and poaching staff for their own benefit or that of a competitor.

Common types of restrictive covenant

Restrictive covenants apply for a specified period of time after leaving the business and commonly cover:

• non-competition – preventing them from performing a specified type of work in competition with your business;
• non-solicitation – preventing them actively approaching customers, clients, and suppliers, usually with whom the employee has built up a relationship;
• non-dealing – prevents them from dealing with customers and clients of your business even though the former employee has done nothing to pursue them (this is more likely to be enforceable if it refers to specific, high-value customers); and
• non-poaching – preventing them approaching employees, usually skilled or experienced employees with whom the employee had contact.

Why do I need an employment lawyer?

The courts take a dim view of a restraint of trade which unreasonably restricts a former employee from taking up new opportunities. Unless restrictive covenants are appropriately worded to protect legitimate business interests, the court will refuse to enforce them. Our employment lawyers are highly skilled in this area and will ensure the wording is right so that the restrictions are enforceable.

When do courts enforce restrictive covenants?

The courts will consider the scope of the restriction, including its duration, any geographical range and the type of activity. The context is crucial, including the interests you need to protect, the nature of the business, standard covenants used in the sector, and the information and contacts the employee has gained. We will take these into account to ensure the wording stands up to scrutiny by the court.

Other ways to protect your business and legitimate business interests

There are other options which we can explore with you, instead of or in tandem with restrictive covenants. These include bespoke confidentiality clauses to protect specific information or a long notice period coupled with garden leave provisions. A garden leave clause allows you to restrict the departing employee’s work activities and contact with key clients or to prevent them from working at all during their notice period.

We can also advise you on ensuring that the business does not do anything which could release the employee from the restrictions.

How we can help

By understanding your business and the knowledge and contacts the employee gains through their role, we will advise you on the best ways to protect your business when the employee leaves. This can include:

• using our extensive contract drafting expertise to write bespoke, precise and enforceable provisions;
• supporting you in renegotiating restrictions with an employee as the business or the employee’s role evolves;
• advising on whether or not existing contractual provisions are likely to be binding on the employee at the time they depart; and
• sending a letter to the employee and any prospective employer warning them not to breach the restrictions.

If you need to enforce the restrictions then we can refer you to our experienced Dispute Resolution and Litigation team.

Why choose Geoffrey Leaver Solicitors?

Our highly experienced employment solicitors are perfectly placed to help protect your business.

To make an appointment to speak to one of our Employment Solicitors call Paula Stuart on 01908 689345 or Stuart Snelson on 01908 689318, or send an email to legal@geoffreyleaver.com.

What our clients say:

‘It is a pleasure to work with a lawyer who answers the questions asked, makes practical and relevant suggestions and is cost conscious.’ Christine Simpson, European Counsel, Mentor Graphics

You may also like to read some of our most recent testimonials from our employment clients  to find out what others think about our Employment law services.