Funny situation

[roofing solutions]

A friend of mine has recently left a hairdressers she was working for, when she arrived at this hairdressers she bought a lot of custom with her.
She was employed untill last week when her former boss said the business was in trouble and she had to go self employed. she had already been offered her new job which is also a self employed position but in a much nicer salon which is well run and in no danger of going under. she has moved to the new salon, and the old salon ceased trading and re-opened as a limited company. she had a contract with the old salon saying she couldn't take custom away, this contract was with the old sole trader not the new limited company. If she was to call her old customers to invite them to the new salon could she possibly get taken to court? Or as the business has stopped trading but opened in a new name does the original contract still stand??? I could really do with someone who really knows about this stuff give her some advice as she is too scared to call up the customers she took to the salon in the first place but then stupidly signed a contract saying she couldn't ask them to follow her again!! thanks for reading and any help really appreciated! Aaron

 

[Kernowman]

The short answer is the customers have not signed any contracts have they?

No company "owns" it's customers and I know many ladies who will travel further just to go to their regular hairdresser (who ever they work for) who "understands" their hair.

Us chaps don't have that problem, do we?

 

[roofing solutions]

To be honest I avoid getting my hair but like the plague, but that's another matter!
What I really need to know is if the contract still stands even though the business has re opened as a limited company and the original business is no longer existent?

 

[Dawg]

The contracts are very difficult to enforce as the courts take a dim view of people being prevented from earning a living.

I doubt if the contract still stands, whether it was ever enforceable and as a layman would suggest your friend has nothing to worry about (apart from a bit of verbal from the old salon owners.)

 

[LawHound]

Your friend needs to take advice on this including a review of the contract. Non poaching of clients clauses can and are enforced by the courts, and should not be confused with other types of restrictive trading clauses, such as those attempting to stop direct competition in a wide area.

Whilst no one can stop the clients moving salons, a migration to your friend's new place of business can result, if the contract is valid in this regard, against your friend and action in court is based on financial loss etc.

Your friend needs to take legal advice on her specific problems, its too complex to rely on forum advice on this one. As, if the sole trader 'sold' the business to her new limited company or there is a transfer of business then it opens up a whole range of legal issues that need to be discussed with your friend.

We donate time for employee related issues to www.legalhounds.co.uk , your friend could contact them. I know ACAS are also widely recommended on various forums but for detailed employment law issues your friend needs specialist help, ACAS do not offer advice just help.

 

[MartCactus]

In order to enforce a contract, as a general rule you have to show "privity of contract" - ie that you were a party to that contract. You can't take legal action to enforce performance of a contract that you weren't a party to (as a general rule).

So if she had an employment contract with the old sole trader (and the restrictions were in that contract), then a new limited company couldn't sue on that, unless if had acquired the sole trader business, and therefore acquired its rights and obligations. Do you know more about the circumstances that the old business stopped trading, and the new ltd company started?

 

[roofing solutions]

The company was going under so her accountant got her to go limited. Her old contract was out of date, her wages, hours, comission had all changed. This was signed in 2008. The old hairdressers also owes a large amount in vat which she cannot pay. We don't know if the new limited company bought the old company although if it did I suppose it would also have bought the vat bill! I cannot she the old hairdressers lasting much longer so maybe she won't be around to go to court anyway. Sorry about the poor writing but this is written on the blackberry!

 

[cautiouscapy]

You might like to suggest this to your friend:

Hairdressers who move commonly let their existing clients know with a photo and announcement in the local press or other appropriate place:

"Kelly Smith is now working at ShortCutz, 101 High Street, Tel: XXX XXXXXX"

A poster in the new salon window welcoming the new stylist, again with a photo would also be appropriate; some of her existing customers will see it.

That way you are not seen as approaching clients to "steal" them; but if the client still wants to use that hairdresser, they know where to find them.

CC