• Restrictive covenants

Discussion in 'Employment & HR' started by NS992, May 1, 2015.

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  1. NS992

    NS992 UKBF Newcomer

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    I have just been dismissed by gross misconduct from my current job, and I have a restrictive covenant in my contract as follows
    You will not, for a period of 6 months after termination of your employment, be engaged in any business or competition with the Company either as principal, agent, employee or otherwise within a radius of 20 miles from the Company’s premises.

    Two things, am I not able to go self employed within the same trade and or work for a company which sells the same product (the latter is 10.2 miles away from my previous place of work)

    I have done this job since leaving School (20 odd years) and I know no other trade, am I not entitled to work? I am at a lost of what I can do, any help would be appreciated.
     
    Posted: May 1, 2015 By: NS992 Member since: May 1, 2015
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  2. Bruceflea

    Bruceflea UKBF Regular

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    There is a clause similar that generally exists within contracts in the telecoms industry. My understanding there (based on cases where employees who were pursued regarding the clause) is that it is not enforceable as they are restricting your right to work. Now what they were told was that they cannot solicit any customers that they dealt with/ brought on board during that 6 month period.

    This is just info based on experience so don't take it as gospel as I am not qualified to give you legal advice but I am sure someone who is, will likely be along soon.
     
    Posted: May 1, 2015 By: Bruceflea Member since: Apr 6, 2010
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  3. NS992

    NS992 UKBF Newcomer

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    here is a copy of the full restrictions

    1. Confidentiality and post-termination restrictions
    You will not, for a period of 6 months after termination of your employment, be engaged in any business or competition with the Company either as principal, agent, employee or otherwise within a radius of 20 miles from the Company’s premises.


    You will not, for a period of 6 months after the termination of your employment, solicit an employee of the Company who was employed in a management capacity with a view to that employee taking employment with you or any business with which you may be associated.


    You will not, for a period of 6 months after the termination of your employment, solicit or do business with any person, who was a customer of the Company during the period of 12 months before such termination.
     
    Posted: May 1, 2015 By: NS992 Member since: May 1, 2015
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  4. cjd

    cjd Verified Business ✔️
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    First off, these clauses are pretty standard and generally are enforceable so long as they're not unreasonable - unreasonable would be too long or too wide. 6 months and 20 miles could well be reasonable - depending on sector and product. It also depends on seniority and relevance in the company - It would be unreasonable to attempt to restrict a receptionist in this way for example.

    Secondly, you signed the bloody contract.......
     
    Posted: May 1, 2015 By: cjd Member since: Nov 23, 2005
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  5. NS992

    NS992 UKBF Newcomer

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    I worked for a monumental masonry company which install memorials in a large district, all I want to do is some masonry work for a Funeral Home which is sited 10 miles away but sells memorials within that 20 mile radius.
     
    Posted: May 1, 2015 By: NS992 Member since: May 1, 2015
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  6. cjd

    cjd Verified Business ✔️
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    It sounds like it would be highly unreasonable to attempt to enforce it to me....but I'm not a lawyer. To get a proper answer you'd have to ask an employment lawyer.

    But how would your ex-employer know?

    Secondly, why on earth did you sign such a thing?
     
    Posted: May 1, 2015 By: cjd Member since: Nov 23, 2005
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  7. NS992

    NS992 UKBF Newcomer

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    I think my ex-employer would only know if I was seen installing a memorial within a cemetery which is in their 20 mile radius.

    I was asked to sign the contract to take on the position, at the time I did ask for the restriction to be changed to 3 months, and 10 miles, which they did say they would change. I was never given the altered contract and unfortunately for me I signed the first one.
     
    Posted: May 1, 2015 By: NS992 Member since: May 1, 2015
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  8. cjd

    cjd Verified Business ✔️
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    Personally I think that in your case it's totally unenforceable and a restraint of trade - non-competes aren't intended for your kind of work or position.

    But I'm not a lawyer....ask one.
     
    Posted: May 1, 2015 By: cjd Member since: Nov 23, 2005
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  9. obscure

    obscure UKBF Legend

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    I'm not a lawyer, nor do I play one in a TV drama.

    I agree with cjd. Non-compete clauses are intended to protect the company when an senior employee with access to confidential company information/client lists or someone in a client facing role leaves the company and joins a competitor.

    They aren't necessary or applicable to someone whose role is purely production oriented without any management or customer facing element and I believe that your employer would have a very hard time getting a court to enforce such a clause. However, as you signed the contract it will cost you if they decide to try and take action.
     
    Posted: May 2, 2015 By: obscure Member since: Jan 18, 2008
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  10. NS992

    NS992 UKBF Newcomer

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    Thanks guys for the help, I think I am stuck as I was at the time of leaving in a management role even though there were only 4 of us in our workplace. If I was to be offered a position at a funeral directors who do sell memorials to their customers of whom they have done funerals and I was to take the position of lets say cleaner or car washer. could that make it hard in them making a case against me?
     
    Posted: May 2, 2015 By: NS992 Member since: May 1, 2015
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  11. paulears

    paulears UKBF Legend

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    I would have not expected funerals to be a repeat business activity. It's not like you can canvas your ex-customers is it? If somebody had a family member die and arranged something, it's not going to happen again, or is their worry you working for another monument producer? Do you really have knowledge that would benefit a new employer.
     
    Posted: May 2, 2015 By: paulears Member since: Jan 7, 2015
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  12. Newchodge

    Newchodge UKBF Legend

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    Restraint of trade is illegal under EU riles, however a company is entitled to protect itself from ex-employees. A restrictive covenant is a compromise between these 2 things. If you taking the job enables your new company to compete better against your old company than they would have done with any other employee, the covenant would probably be enforceable. if not, it probably wouldn't be. No one can say for certain which way a court would look at it, even an experienced employment lawyer.

    Only you cna really know the answer to whether you will give your new employer an unfair advantage.
     
    Posted: May 2, 2015 By: Newchodge Member since: Nov 8, 2012
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  13. Jeff FV

    Jeff FV UKBF Legend

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    Does the fact that he was dismissed have any bearing on this case?

    I have no idea, am merely curious.
     
    Posted: May 2, 2015 By: Jeff FV Member since: Jan 10, 2009
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  14. NS992

    NS992 UKBF Newcomer

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    Newchodge, that was quite interesting, I could compete better and thats why they would enforce it. But if i were to only deal with clients in which the Funeral company had dealt with then wouldn't this work not be competition as the Funeral company had already the advantage?
     
    Posted: May 2, 2015 By: NS992 Member since: May 1, 2015
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  15. kulture

    kulture Moderator
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    Another way of looking at it is what damage could you do to their business. If they were to take you to court it is this damage they would be suing you for. If they cannot prove any damage then they are unlikely to be able to uphold this clause.
     
    Posted: May 2, 2015 By: kulture Member since: Aug 11, 2007
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  16. Newchodge

    Newchodge UKBF Legend

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    Absolutely none. If being dismissed meant the covenant was unenforceable, some employees might get themselves dismissed so they could work with the opposition.;)
     
    Posted: May 2, 2015 By: Newchodge Member since: Nov 8, 2012
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  17. Newchodge

    Newchodge UKBF Legend

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    Could you compete better because of your knowledge of your ex-employer's business?
     
    Posted: May 2, 2015 By: Newchodge Member since: Nov 8, 2012
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  18. Scott@KarmaContent

    [email protected] UKBF Legend

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    With anything like this, you have to take proper legal advice. People can discuss it all day long on here but you're not going to get a definitive answer until a professional sits down and looks at your contract.
     
    Posted: May 2, 2015 By: [email protected] Member since: Jun 24, 2014
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  19. NS992

    NS992 UKBF Newcomer

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    I could compete better only due to the area i am in and who I know in the area. This does not bring me clients. the difference between me and my old company is passion and eat, breath and sleep this business.
     
    Posted: May 2, 2015 By: NS992 Member since: May 1, 2015
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  20. Newchodge

    Newchodge UKBF Legend

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    Please stick to the point. If your experience with your ex employer gives your new employer an advantage, you probably can't take the job.
     
    Posted: May 2, 2015 By: Newchodge Member since: Nov 8, 2012
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