how enforcable is this contract clause?(7 Posts)
Currently on at leave and due back to work in August. For various reasons I don't want to go back to my current job but need to work,so I speculativly sent my CV into an office within my current profession in my home town. They have asked me to come in to 'have a chat' later this week.
My contract with my current employer had a 'competition clause' staying I can't work for any of our competitors within a 5 mile radius within a certain period of leaving,need to dig it out for the exact wording but think it's a 6 month period. However the company will be meeting this week have opened a second office on the same street as my current employers second office. Where I currently work is outwith this 5 mile radius and if I did get a new job I wouldn't be based in the their second office.
Hope that made sense!
If I got the new job would I be in breach of contract and what,if any,action could my employer take? I should add that my reference for my current job is the former office manager who left a few months ago so it is possible that my current employer would never find out I started work for the other company.
Yes, it's enforceable. Will it be enforced? That depends on whether it's worth the legal costs to enforce it.
How much risk is there to the current employer if you work for a competitor? If you worked in a sales role and had inside information on margins and targets, and had access to the customer contact database, then they might chase you. That will include a letter to you, and a letter to your future employer telling them you have breached your contract. If you worked in admin support, with limited access to commercial info then they are less likely to enforce the restrictive covenant.
If you've been on mat leave, there is every possibility that any market/customer intel is out of date so the employer will decide not to pursue.
Thanks olly. Will respond in an hour or so. From what you're saying I should be ok but want to provide more info and will be easier to do that infront of a computer.
Restrictive covenants have to be concisely and narrowly drafted and go no further than is reasonably necessary to protect your employers legitimate business interests to be enforceable.
Whether they can be upheld will depend on your level of seniority and how the covenant itself is drafted; even a minor error could render it unenforceable. Non compete clauses must only apply to the business you actually undertook which could be in competition.
In theory, yes, they can be enforced by way of an injunction and/or damages for breach of contract. In practice though, would your employer really go to the high court for an injunction?
Apologies it's taken me so long to get back.
To try and keep this as clear as possible I'm going to refer to my current job as job 1, with office A (where I am based) and B, and prospective job as job 2, with office A (where I would be based) and B
Job 1 is in a lettings agency who also do some sales, this makes up a tiny part of the business. Pretty much everything is ran from office A, office B deals with accounts. Job 2 is with an estate agency who also do lettings though this is a much smaller part of the business. They have opened office B which is on the same street as job 1 office B. Office B cover sales and lettings for that town and surrounding area. I would be working in office A, which is in my home town over 20 miles away from where I currently work.
In job 1 I am basically an admin person, I don't know any commercial information that isn't available to the general public, such as fees we charge landlords etc. I know some landlords who rent more than one property with us get discounts on their fees but I couldn't tell you what those discounts are or who gets them. While i have had access to landlord information, names addresses etc after being off since December I could only name a handful of them, and certainly couldn't give any information other than their names
I don't know what they would be wanting me to do in job 2 though i suspect they want to build the lettings side of the business. I have fairly up to date information on the legislation surrounding rental properties and tenancies. I would be based in an office over 20 miles away from where I am currently working. A look on the website for job 2 shows they have only a handful of properties for rent or sale in the areas where job 1 operate and NONE in the areas where job 1 are most prolific.
I would say the locations are a huge factor in your favour here. If you can argue that there is no overlap with any landlords/properties in your new role then they shouldn't have any concerns about you taking clients or business with you to your new company. Plus the fact that you've been off work for a while and so you're not up to date.
They are only likely to pursue the clause if they are in danger of losing any business / commercially sensitive information from your new appointment.
I think you're on safe ground to pursue this other job, and consider your argument should your current company decide to enforce the clause (which does seem unlikely in this case).
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