header-logo header-logo

08 May 2015 / Tom Walker , Richard Marshall
Issue: 7651 / Categories: Features , Employment
printer mail-detail

The long and short of it

Tom Walker & Richard Marshall consider the length of restrictive covenants

The last two years have seen several cases in which lengthy client contact restrictive covenants on termination of employment have been upheld by the courts. It has been said that covenants are currently “employer friendly” and 12 months can be applied with confidence.

This would be a dangerous assumption to make. Going back to the basics of covenant law, a restrictive covenant is void for restraint of trade unless it provides no more than reasonable protection for a legitimate interest. This was famously stated in the 2005 case of TFS v Morgan [2004] EWHC 3181 (QB), [2005] IRLR 246. It is a hasty practitioner who applies template covenants to an employment contract without considering the nature of the employee’s activities, client contact and seniority.

Covenants upheld

In each one of these recent cases, there has been clear justification for the period of restraint:

  • Coppage v Safeynet Security Limited [2013] EWCA Civ 117, [2013] All ER (D) 308 (Feb): The
If you are not a subscriber, subscribe now to read this content
If you are already a subscriber sign in
...or Register for two weeks' free access to subscriber content

MOVERS & SHAKERS

Walkers—Muriel Marseille

Walkers—Muriel Marseille

Ashurst's Chief Risk Officer joins Walkers

Excello Law—John Osborne

Excello Law—John Osborne

Northern family lawyer John Osborne joins Excello

mfg Solicitors—Rebecca Rogers, Kennedy Langley & Victoria Griffiths

mfg Solicitors—Rebecca Rogers, Kennedy Langley & Victoria Griffiths

Trio of promotions announced at Kidderminster law firm mfg Solicitors

NEWS
A sole director can conspire with their own company for the purposes of the tort of unlawful means conspiracy, the High Court has ruled in a judgment with potentially wide implications for business disputes
The Court of Appeal has reinforced that domicile depends on intention rather than residence alone, in a significant post-Brexit ruling on cross-border financial remedy claims
The Chancery Division's long history comes to an end this autumn as it is reborn as the Business and Property Division, prompting questions over whether the shake-up is really necessary
The Financial Conduct Authority (FCA) continues to show that failing to disclose regulatory issues can attract harsher consequences than the original misconduct itself
Rejecting a generous settlement can prove an expensive mistake, as two recent high-profile cases demonstrate
back-to-top-scroll