Non competition clauses
Discussion
Hi,
I hope someone can shed some light on the above subject? I recently departed from my previous employer over one month ago. I am now looking to work for myself within the same industry, my ex employer rents, sells and claims’ to manufacture (he does not have manufacturing facilities). He has found out that I will be supported by the manufacture that he receives equipment from and has indicated that I am in breach of my non competition clause (12 month) and states that he is going to take me to court. My back ground is sales with various skills in this particular industry, which I feel he does not own, nor has he trained me to do any of the above.
What should I do, should I give in and find something else or get on with my plans?
Any help or advise would be most appreciated
I hope someone can shed some light on the above subject? I recently departed from my previous employer over one month ago. I am now looking to work for myself within the same industry, my ex employer rents, sells and claims’ to manufacture (he does not have manufacturing facilities). He has found out that I will be supported by the manufacture that he receives equipment from and has indicated that I am in breach of my non competition clause (12 month) and states that he is going to take me to court. My back ground is sales with various skills in this particular industry, which I feel he does not own, nor has he trained me to do any of the above.
What should I do, should I give in and find something else or get on with my plans?
Any help or advise would be most appreciated
the clause is as follows.
the emplyee covenants with the company that he or she will not within a three mile radius and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
the emplyee covenants with the company that he or she will not within a three mile radius and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
IANAL.
My understanding is that these clauses have to be proportional, limited, and directly concerned with protecting the legitimate interests of the company. However and importantly in your case, your freedom to work is generally considered to be more important and whilst successful legal action is not unknown, it's very difficult to achieve. In any event, they can only sue you for their direct losses.
So - a lot depends on what you're doing. If you have taken a list of your old contacts, that's bad. If you go to any of them and say look, I can do you a better deal if you go through me - that's actionable.
If, conversely, you are selling a different product line, or to different customers, or in a different area, then you are 100% in the clear.
My understanding is that these clauses have to be proportional, limited, and directly concerned with protecting the legitimate interests of the company. However and importantly in your case, your freedom to work is generally considered to be more important and whilst successful legal action is not unknown, it's very difficult to achieve. In any event, they can only sue you for their direct losses.
So - a lot depends on what you're doing. If you have taken a list of your old contacts, that's bad. If you go to any of them and say look, I can do you a better deal if you go through me - that's actionable.
If, conversely, you are selling a different product line, or to different customers, or in a different area, then you are 100% in the clear.
not a lawyer
but as the clause says within 3 mile radius and 12 months by using the word "and" means that both parts of the statement must be true in order for you to fall foul of that clause, if they had used "or" that would be different, as long as the new work is outside 3 miles then are you not ok.
but do they define where the centre of the 3 mile radius is?
but as the clause says within 3 mile radius and 12 months by using the word "and" means that both parts of the statement must be true in order for you to fall foul of that clause, if they had used "or" that would be different, as long as the new work is outside 3 miles then are you not ok.
but do they define where the centre of the 3 mile radius is?
Edited by a boardman on Wednesday 11th November 13:24
Equally not a lawyer but:
So by my reading you can compete at a distance of 3 miles and 1 foot but only after 12 months.
mgbruce2000 said:
the clause is as follows.
the emplyee covenants with the company that he or she will not within a three mile radius
Looks like one clause, banning youy from competing locally everthe emplyee covenants with the company that he or she will not within a three mile radius
mgbruce2000 said:
the clause is as follows.
and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
The 12 months looks like a global attempt to prevent you competing.and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
So by my reading you can compete at a distance of 3 miles and 1 foot but only after 12 months.
What kind of business is it - 3 miles seems amazingly parochial?
Some people say these things can't be enforced but it rather depends on how far the ex-employer will push it. My next door neighbour got caught up in this and his new employer said they'd go to court but then called a halt when they were looking at legal costs of £40K if they lost. His old employer was prepared to pay him not to work for 6 months.
Some people say these things can't be enforced but it rather depends on how far the ex-employer will push it. My next door neighbour got caught up in this and his new employer said they'd go to court but then called a halt when they were looking at legal costs of £40K if they lost. His old employer was prepared to pay him not to work for 6 months.
VX Foxy said:
pugwash4x4 said:
get proper legal advice.
my experience is that non competition clauses are very easy to circumvent.
^This. Very difficult to enforce. my experience is that non competition clauses are very easy to circumvent.
In my neighbour's case, Councel's opinion was divided (he felt they just trying to string it out, and why wouldn't they) and his new employer bottled it.
employ yourself in a non-competing role within a Ltd Co of which you are neither the sole shareholder nor MD, nor Co Secretary.
Give yourself a role title such as "chief Cashier"
Then ask old Co what they would like to do?
This puts them in the position of having to proove beyond reasonable doubt that you are competing. They won't be able to do it.
Give yourself a role title such as "chief Cashier"
Then ask old Co what they would like to do?
This puts them in the position of having to proove beyond reasonable doubt that you are competing. They won't be able to do it.
mgbruce2000 said:
the clause is as follows.
the emplyee covenants with the company that he or she will not within a three mile radius and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
That says to me that you cant work in competition within 3 miles of them for 12 months - which I would expect to be reasonable (OK maybe 6m rather than 12, but I dont see that as being an unreasonable restraint of trade).the emplyee covenants with the company that he or she will not within a three mile radius and for a period of 12 months after ceasing to be employed without the prior consent of the board either alone or jointly with or as manager agent or concultant or employee of any person firm or company directly or indiectly carry on or be engaged in activity or bussiness which shall be in competition with the business of the company xxx.
But You could set up anywhere outside of the 3 miles. They can't stop you working in the industry for 12 months, that would be an unreasonable restraint. imho ianal.
Just because a clause is in a contract that doesn't make it enforceable. To be enforceable the clause needs to be protecting a legitimate business interest and it needs to be reasonable and proportional.
There is a chance that this clause won't be enforceable in your case, but it needs more knowledge of the circumstances that you can provide on line, it's a job for a solicitor. Even if it is enforceable you can base yourself 3 miles away
There is a chance that this clause won't be enforceable in your case, but it needs more knowledge of the circumstances that you can provide on line, it's a job for a solicitor. Even if it is enforceable you can base yourself 3 miles away
Edited by siscar on Saturday 14th November 15:01
Gassing Station | Jobs & Employment Matters | Top of Page | What's New | My Stuff