Taking on an employee with restrictive covenants

legal updates

Not all restrictive covenants, if put to court scrutiny, will be upheld as valid.

Read our disclaimer keyboard_arrow_down

This website content is intended as a general guide to law as it applies to the motor trade. Lawgistics has taken every effort to ensure that the contents are as accurate and up to date as at the date of first publication.

The laws and opinions expressed within this website may be varied as the law develops. As such we cannot accept liability for or the consequence of, any change of law, or official guidelines since publication or any misuse of the information provided.

The opinions in this website are based upon the experience of the authors and it must be recognised that only the courts and recognised tribunals can interpret the law with authority.

Examples given within the website are based on the experience of the authors and centre upon issues that commonly give rise to disputes. Each situation in practice will be different and may comprise several points commented upon.

If you have any doubt about the correct legal position you should seek further legal advice from Lawgistics or a suitably qualified solicitor. We cannot accept liability for your failure to take professional advice where it should reasonably be sought by a prudent person.

All characters are fictitious and should not be taken as referring to any person living or dead.

Use of this website shall be considered acceptance of the terms of the disclaimer presented above.

Employers should be careful about taking on staff with restrictive covenants in place. If the employer gives a job to someone in full knowledge that the employment will be in breach of the restrictive covenants, the employer may be liable in tort for inducing a breach of contract. 

Restrictive covenants are an increasingly common elements of employment contracts. They are designed to protect the business by preventing a departing employee from seeking employment with a competitor, approaching the existing customers or poaching staff. Their enforceability is quite a complex area and not all restrictive covenants, if put to court scrutiny, will be upheld as valid. The restrictions may last too long or cover too wide an area, for example, and will be deemed as unfair restriction on trade.

In a recent Court of Appeal case David Allen v Dodd & Co Limited the employer checked with its solicitors whether the restrictive covenants in a newcomer’s contract with his previous employer were enforceable or not. The solicitors advised that on the balance the restrictive covenants would not be enforced. When the proceedings were issued, the court took a different view and found the restrictions valid. The employer, however, relied on the advice of the solicitors, albeit erroneous, and therefore was not deemed to be knowingly inducing the contractual breach, thus escaping liability.

InvolutionSTAFF UNIFORM | PROMOTIONAL WEAR | MERCHANDISE | BUSINESS GIFTS

Leading experts in print, promotional clothing, staff uniforms, branded merchandise and PPE. Involution is your brand partner for promotional marketing and workwear, a one-stop-shop for your branded marketing needs for any business size and industry.

Kiril MoskovchukTrainee SolicitorRead More by this author

Related Legal Updates

New employment legislation effective from 6 April 2024

Enhanced employee rights, offering day-one entitlements to carer’s leave, flexible working arrangements, and extended redundancy protection for pregnant employees and those on family leave.

Wages increasing from 1 April 2024

With effect from 1 April 2024, the hourly rates of pay are…

Employment Law: Carer’s Leave

The regulations explicitly safeguard employees from any detriment or dismissal resulting from taking or seeking to take carer’s leave.

Employment Law: Annual Leave Changes

Several significant changes came into force on 1 January 2024 that affect the statutory annual leave and pay entitlements.

The office Christmas party season is here

Where an employee makes comments concerning a person’s body parts or style of dress that are intended to be good-natured but are perceived as offensive…

Update on Rights to Flexible Working Requests

Employers will remain entitled to turn down a request pointing to reasonable grounds as a basis for refusal.

Three new employment laws for 2024

The Carers Leave Act, The Neonatal Care (Leave and Pay) Act and The Protection from Redundancy (Pregnancy and Family Leave) Act.

Get in touch

Complete the form to get in touch or via our details below:

Phone
01480 455500
Address

Vinpenta House
High Causeway
Whittlesey
Peterborough
PE7 1AE

By submitting this quote you agree to our Terms & Conditions and Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.