Restrictive covenants
Enticement of the clause
💕typically through injunction 💕if the court finds its invalid, they will not re-write the clause for the parties...... they may refer to the blue pencil rule
The criteria that has to be satisfied about the employer to make the covenant enforceable
1-it has a legitimate business interest requiring protection 2- the covenant is reasonable necessary to protect the legitimate business interest 3- the covenant goes no further than reasonably necessary
Category of restrictive covenants
1. Non- competition clauses 2.non-solicitation 3.Non-dealing clauses 4. Anti poaching clauses
Another name for restrictive covenants
Post termination covenants
General Bill Posting v Atkinson
The clause cannot be relied upon if the clause has already been broken by the employer
When is the covenant reasonably necessary
When it's protecting a legitimate business interest
Common categories of legitimate interest
-connection with clients -connection with suppliers -stability of workforce -stability of workforce -Trade secrets and confidential information
Pilon clause
A way of anticipating the restrictive covenant clause to avoid a breach. As it allows the employer to give the employee notice by giving them money, this is agreed to by the parties
General common law duty
Against restraint of trade clause, an employer cannot protect himself from competition only against the use of customer connections
Restrictive covenant
An express clause in the employee. contract that restricts their ability to work for an competitor after the employment has come to an end
Herbert Morris v Saxelby
For legitimate interest, the clause must be reasonable between the parties
Living design v Davidson
If the contract is breached by the employer, it still will be held as a breach
Rock v Jones
The employer cannot use the clause if they have breached the clause
Countrywide v pollard
The employer has to prove that the clause should be upheld
Validity
The nature of the work and the access the employee had has to be considered
