Business Protection

Restrictive Covenant Clauses

During the course of employment, employees will have access to their employer’s technology, confidential information, intellectual property, contacts and clients, and perhaps most importantly the details of other employees and consultants engaged by the employer.

Employers may wish to consider including terms into the contract of employment that aim to restrict an employee’s ability to use – on an unauthorised basis and for their own benefit (or the benefit of another) – the resources, confidential information, clients, employees and property of the employer.

These contract terms are sometimes referred to as Restrictive Covenant terms.

Restrictive Covenant clauses usually apply whilst the employment relationship persists and also after the employee’s employment has terminated. How long the restrictions will be effective and enforceable after the termination of employment is dependent on the business interest being protected and the proportionality of the length of the restriction.

The Tribunal and Courts have taken a restrictive approach to the interpretation and enforceability of such clauses, so it is important that any restrictive covenants included into the contract of employment have been considered carefully by the employer and can be evidenced as being in pursuit of a legitimate business interest and are proportionate.

At Hanne & Co, our Employment Law team  can assist you to develop tailored Restrictive Covenant clauses for inclusion into your contracts of employment. Accessing legal advice at the appropriate time can enhance the prospects of these types of clauses being found to be enforceable should that become necessary.

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