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Restrictive employment covenants

(16 Posts)
wickerdog Sun 28-Jul-13 22:04:27

I think actually demonstrating the loss could be really difficult for them, especially over a shorter term as you say. To do so would require a good grasp of the software in order to generate location-specific statistics. Hmmmmmm.

I really appreciate your thoughts, thank you.

flowery Sun 28-Jul-13 21:28:33

Even leaving it as long as possible would reduce the risk of them taking legal action against you. Obviously the risk is much higher if you leave and immediately start trading than it would be if you leave, start doing something else, then at, say month 9 or 10 start trading. By the time they'd noticed, then got their act together, taken legal advice etc it would only be a matter of weeks and much more difficult to demonstrate a significant loss.

wickerdog Sun 28-Jul-13 21:03:39

I'm considering that option. Financially we haven't got enough of a cushion but I guess if I could get a maternity cover somewhere that might work ok.

flowery Sun 28-Jul-13 20:22:12

Assuming this involves setting up on your own, could you leave, and spend the year doing everything except actually trading? Get website done, do all your research, building up contacts, get anything else done so that 12 months from leaving date you can start trading straightaway? Temp in the meantime to keep some money coming in?

wickerdog Sun 28-Jul-13 19:54:52

I've made suggestion after suggestion, implemented what I can and pushed for action for years. Progress is painfully slow, we're at risk of an out of area competitor anyway, and to be honest I feel like this much work should be benefiting me directly now. Instead all the effort I'm putting in is rewarding my employers.

Maybe I should just pack up and move away but we're all happy here, DC settled in school etc, DH has a good secure job, seems mad to bail out on decades of work.

Having said that, the figure I come up with from your calculations is terrifying, Lone!

Lonecatwithkitten Sun 28-Jul-13 11:04:06

Wicker I have replied on your other thread and having read this one suspect you maybe in a similar if not the same business as me where binding out clauses are very common due most of the business value being in the goodwill.
I believe that some of my professions professional organisations hold details of case law on this. Last time I looked the value of an individuals goodwill is nothing till they have been working for 2 years then it is worth 1% per year over 2years of turnover. So if you have been working for them for 7 years you could potentially be sued for 5% of business turnover. For my business this would be a figure of around £45,000 so yes I would go after it.
It would be worth discussing this with the legal team of your professional organisation as they would be able to advise you very specifically.

flowery Sun 28-Jul-13 09:33:38

"A friend in this business seems to think that if I can find something in the contract which the employer had breached then I could tear it up anyway. I am sure there will be something!"

Not as simple as that, especially if you let the alleged breach you would "find" go at the time. I take it this friend isn't in the business of employment law...?

It's often not worthwhile an employer taking legal action in respect of a restrictive covenant breach unless they can demonstrate significant financial loss as a result of the breach.

Impossible to advise how enforceable the clause is without the wording but if you yourself think it's reasonable then that's not a good sign.

Can you operate outside your geographical restricted area?

ImTooHecsyForYourParty Sun 28-Jul-13 08:15:40

And you've suggested this new way to your employers and they don't want to do it?

HomeEcoGnomist Sun 28-Jul-13 08:14:29

Well it's pretty difficult to tell you anything without knowing what your contract actually says

But don't get carried away with the idea that if you can think up a breach by them then you can consider the contract void - the remedy for a breach is not to let the other party breach in turn!

If you think your non compete terms are acceptable / the norm for your industry, and you would impact on your employer's business then I would expect that they do try to enforce them. A well drafted contract doesn't expire just because it's been around for a while...

wickerdog Sun 28-Jul-13 08:03:23

The thing is, I'd be offering the same service in a more convenient way. I have no doubt that would attract new business but it would also take from the existing business. There is no local competitor so I would clearly be taking clients, although they would be choosing to come to me.

ImTooHecsyForYourParty Sun 28-Jul-13 07:55:25

Couldnt you argue that you're not breaching any thing because you are offering something they are not offering?

I do not work in employment law, its just a thought.

wickerdog Sun 28-Jul-13 07:46:46

I could definitely damage the business. I wouldn't seek to, but the reason I'm considering this is that my employers are failing to meet the needs of the market within our area and I'm so frustrated by this missed opportunity I want to do it myself.

wickerdog Sun 28-Jul-13 07:44:54

I have fairly wide restrictions, geographically and for 12 months. However, I think in my field this is reasonable.

So even though the terms of employment are now different, I could still be held to what's on the contract?

A friend in this business seems to think that if I can find something in the contract which the employer had breached then I could tear it up anyway. I am sure there will be something!

toomuch2young Sun 28-Jul-13 07:37:09

I am in a similar position to you also.
I am struggling to see how enforceable it would be anyway as financially it wouldn't be to the businesses benefit.
Watching with interest.

flowery Sun 28-Jul-13 07:22:47

The fact that the contract is old wouldn't necessarily affect how enforceable a restrictive covenant in it is.

Is this post-employment? Are you able to be a bit more specific about what the restrictions are and what you intend to do that would be in breach?

wickerdog Sat 27-Jul-13 22:10:21

I'm considering breaching mine. I'm not convinced they'll hold water but I'm also scared! It's a very out of date contract though, and the terms pretty wide.

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