For example you are not allowed to work for 6 months at a competitor after leaving a company. That makes it 3 months notice + 6 months out of work. It is crazy that you are not reimbursed for those 6 months.
Is it truly no competition work within that period, or none that you have benefitted from developing a relationship with/suitability for the role specifically through interaction in your current assignment? The idea being, they want to prevent you setting things up for yourself or sabotaging your current company's position with their clients. I know that at certain times, if I had left for a role with our client (mixed team), there was a real chance it may have put the service at jeopardy. Realistically I don't think this is the sort of thing that is enforced for the sake of it, more so that they can recoup losses if your move manages to scupper them.
I think your current employer would have to be able to prove losses as a result of you working for a competitor. In reality that's probably a very hard thing to prove - unless there's something obvious like a big contract being lined up and pretty much done and dusted, until you jump ship to a competitor and the contract follows.
In reality many people change jobs to go and work for their competitors. - they're either headhunted, or just familiar with the particular industry they work in. To prevent them working elsewhere would clearly be an unfair clause.
Would you stop someone working in Tesco's from getting a job at Asda?
To prevent damage to their own business by poaching. If you don't see how this can damage your employer, the chances are you're not in a role that it really applies to. Can you detail the role a bit more?
My understanding (as a layman, but I’ve had lots of these in contracts over the years)
They can’t stop you working for a competitor, that’s completely unenforceable.
However, if you go to work for a competitor (company B) and you were in possession of information or trade secrets from your previous employer (company A) and company A could prove that you’re damaging their business, by potentially giving away details to company B then I think it can be enforceable- but only if it can be demonstrated that company A is being harmed.
They are enforceable but need to mainly be reasonable
The first simplest consideration is does it make you unemployable.
A good example is a hairdresser, if you had a clause that said you cannot be hairdresser for 6 months post employment it will almost certainly be considered unfair and hence unenforceable.
If that said cannot be employed as a hairdresser within 3 miles of the place you worked that would likely be deemed reasonable and hence enforceable.
Its harder with more specialist roles since the obvious place you would go to is a competitor. In that case highly likely to be unenforceable and better to retain your staff.
Would previous employers not look to enforce it more in more specialist roles then? If you are a specialist off to work for a competitior challenge is much more?
Yes, the only person who can stop you from actually working for a competitor if there is a restrictive covenant in your contract is a judge in a court.
In reality a judge is only going to rule in favour of your previous employer if they can prove that they’re being damaged due to you working for that competitor.
Judges normally take a dim view of non compete clauses, because we live in a free competitive market, so they’re only going to swing the hammer if they really need too.
The only time a non-compete buggered me up, was when the hiring company didn’t want the aggravation, they were worried about the potential exposure.
They decided to withdraw the offer because they thought the non-compete was potentially enforceable (and it was a rare set of circumstances where it probably could have been).
I was working for a consulting company, and the company where I was temporarily assigned to wanted to “poach” me as a perm for themselves, and I really wanted it.
However, in reality if a client can freely poach employees from the consulting firm, the consulting firm just becomes a buffet from which people can steal whoever they want, which isn’t really fair on the consultancy.
In that case the “thou shalt not engage with, or be employed with any restricted customer” part of the contract was applicable, and fair…. (Even tho though it annoyed the hell out of me)
That was suggested in my case, in fact the company who wanted to steal me, offered to “buy me out” of the non-compete.
However the consultancy firm were proper stubborn about it (they were known for it) and said “we’ll 100% go to court over this” at which point everyone backed down, I left and went my own way….
I believe it was a cross between the two, I’m not 100% sure if I’m honest.
It was 10 years ago so I don’t remember any of the wording, I think they mostly all fall into the same category though.
The wording of the contract can say whatever it likes, but it’ll never really mean anything unless it ends up in a courtroom, which is annoying because it normally means you’ll back down before that point…
A lot of these clauses are written a certain way in legalese, and are often open to interpretation- which requires arguments, judges and lawyers to decide….
I was told by a consultancy previously that their client agreements would have some form of 6 month ban on hiring employees from that consultancy. However, the contract for the employee from the consultancy would not mention this.
Bit sneaky tbh as it still means your out of work for 6 months as the client base for this consultancy was so large
This is expected though to avoid companies just hiring the consultants they like for cheaper than the rate they pay the consultancy. I looked into it once because I had a consultant that had been working onsite with us for about 8 years or something and was keen to become an employee. Basically the steer I got from our legal was that there were ways round it if the consultant resigned their post and then applied for an advertised job. They had to leave the consultancy before applying to the job and the job had to be a genuine open posting that anyone could apply to. So essentially they would not be deemed to have been "poached" given there was a break between them leaving the consultancy and joining the client.
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