What is a restraint of trade?
A restraint of trade is a clause inserted into an employment contract to protect your business’ profitability and confidential information.
What are the benefits of having restraint of trade clauses?
The benefits of having these clauses in your employment contracts is that, if drafted correctly, they can prevent an employee from poaching clients which they have met during their employment.
What are your options?
Consider inserting a restraint of trade into your employment contracts or use a separate deed to restrict your employees. Remember restraints are complicated, if you want to enforce it then it will need to be prepared in the right way.
How do our employment lawyers help you?
Restraints of trade are difficult clauses to draft. They must be acceptable to the court and must not go any further than what is necessary to protect legitimate business interest. We can help you by drafting these clauses to protect your business accordingly, while remaining in accordance with all legal requirements.
Frequently Asked Questions
Is it unreasonable to extend my employees restraint to an entire state?
Sometimes yes and sometimes no, it depends on what your business does, how long that employee has been without and what that employee does in your business.
I do not have a restraint of trade clause in any of my employment contracts, how can I bring one into effect without amending and re-sending all employees an employment contract?
The most common way to include a restraint without the use of an employment contract is to use a deed.
Aside from poaching clients, what can I restrict an employee from doing?
You can restrict your employees from discouraging other employees to leave with them you can also restrain that employee from using your suppliers. There are other things that may be industry specific to restrain your employees from doing as well.