Restrictive Covenants

[little_fish]

Hello there, new to the forum but in need of some advice if possible.

I currently work in an external sales role for an industrial machine manufacturer (company A) and have been with this company for two years. I have recently been approached by a different company (company B) who company A would most definitely deem to be a direct competitor with a very attractive job offer that I wish to accept.

Here is a screen shot attached of the covenants with company A blanked out.....

The main one I believe I could potentially fall foul of is c). (if it is enforceable).

Here is a short timeline of events:
- Start at company A in role 1 and given contract
- 18 months later promoted to a significantly different role but still in sales, contract not amended (role 2)
- Approached by company B with similar job to role 2

My questions are:

• are the covenants enforcable?
• does it change anything that my role changed significantly but my contract was not updated

Thank you in advance for your replies

[teaboy2]

Re: Restrictive Covenants

I would say no as they refer to a geographical area in which you can not work for a business that is in competition with your current employer, but it fails to state what that geographical area is which could relate to the whole of the UK or just 5 miles from your place of work.

Also it states you can not act to supply goods in competition to the your employer to customers you know or are made aware of where basically approached as potential customers, or are customers of said employer and you have been informed or knew as such. Thats suggested you know every single customer the company has approached as a potential customer to supply their goods too and that you know every single current customer of your current employer, which is impossible for you to know them all.

Also it then states your not to work for any company in any capacity weather as an employee, agent or self employed consultant or start your own business that would be in competition of your current company for a period of 6 months after terminnation. Yet usually this can only apply to a limited geographical area such as a radius of 5 miles from your current employer. Which brings us back to the geographical area they mentioned they operate in yet failed to state where that area is, meaning its likely the whole of the UK.

They can not stop you from accepting a job from a rival company that also sells in competition to your current company to consumers/businesses throughout the whole of the UK or anywhere within the UK, they can only restrict you working for a competitor within a certain radius of their geographical location and they don't mention any radius at all. So no, in my view they are not enforceable!

But that's just my opinion as 6 months restriction is justifiable. But the breadth of the geological area is not justifiable! As it doesn't state what the limits of that geological area is. Therefore is it a radius of 5 miles around where you current employer operates from or does it cover the whole of the UK? Reading what is there, i'd say they mean whole of the UK as they have not stated otherwise!


off course their is a way round this, if you accept the other companies offer, then when you talk or deal with customers (assuming this is office based sales, telesales or online based sales with no direct face to face trading) then simply you an alias when talking to customers. This will reduce the chance of your current employer knowing you work for a competitor, also don't tell your friends, or post on social media or accept invites from your new colleagues till after the first 6 months!

[little_fish]

Re: Restrictive Covenants

I might need to clarify that role 1 was purely office based dealing with customers non UK and role 2 is direct face 2 face sales with a specified UK territory. My contract wasn't updated when promoted to role 2 and role 1 is still referred to within my contract, I only recieved a letter confirming my progression.

[des8]

Re: Restrictive Covenants

Hi
Restrictivecovenants such as you describe are really designed to stop poaching of clients/business by staff who leave.
It is expensive for an employer to try and enforce through the courts.
This is a subject we have discussed on LB in the past, and I suggest you you have a look at the threads below:

http://www.legalbeagles.info/forums/...ht=#post460948
http://www.legalbeagles.info/forums/...nts+employment
www.legalbeagles.info/forums/...nts+employment

[little_fish]

Re: Restrictive Covenants

Thanks, I've had a read of the threads, but my situation is slightly different to them, but useful nonetheless