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ck1 | 10:50 Wed 04th May 2005 | Jobs & Education
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If an employment contract has restrictions on working for competitive companies within a certain time of leaving the company, is this actually enforcable or would it be difficult to confirm what is meant by competitive etc?
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Depends in part on the industry.  The industry I work in typically has such clauses, but as there are a limited number of companies in the field, the non-compete clause is not enforced if the person does not actively market services to previous clients.

The legal status of our clauses has never been tested as no-one wants to know the answer!

They can be binding on parties in some cases. The clause must not be unduly restrictive and will be interpreted objectively depending on the surrounding circumstances such as:

Prohibited Business - the business within which the employee is not allowed to engage himself.
Geographical Area - the area within which the employee is not allowed to compete in the prohibited business.
Time - the period of time within which the employee is not allowed to compete with his employer in the prohibited business and geographical area, or solicit customers or other employees.

Although an employer may have a legitimate interest to protect and any restrictive covenant should be drafted so as to be reasonable he should only impose restrictive covenants upon those employees who would be a threat to that interest if they left his employment. For example, if a particular employee has no contact with customers it would be unreasonable for the employer to include a non-solicitation clause in his employment contract.

Remedies to an employer include injunctions

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That's very useful, thanks to you both!

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