Restraint of Trade Clause

[futurecontractor]

Hi

I have a query about restraint of trade clauses that I was looking for some advice on or anyone with previous experiences of them. I will be seeking some legal advice in the New Year but thought some knowledge in advance may help.

I currently work as a permie for a supplier company based in a Government department and I have a 6 month restraint of trade clause in my contract. For external resources, the client either goes through suppliers for resources in certain areas of the business or get contractors in directly in other areas.

I have decided that I want to move into contracting next spring and have already had discussions with someone about a contract role that is being recruited for directly by the client. I have spoken to the team who deal with the recruitment and they have confirmed that the clause would not stop them recruiting me but I would have to deal with any legal consequences of taking the role.

My manager has suggested previously that the higher up levels of management would potentially take action if I were to leave for a role like that. I did suggest I could liaise with the relevant people to check in advance if they would for any specific roles, but was told I would have to just take whatever role I decide to and wait and see if any action is subsequently taken. I have heard indirectly that they have tried to enforce this once before at the same client and lost, but have not been able to verify that for sure and probably won't be able to. But I do know they have let others leave for similar roles without taking any action.

As the role is not 1 that would potentially be filled by my employers, that removes any argument about lost revenue which I would understand if I was taking a role they would otherwise fill.

So I was hoping that some people may be able to provide some general advice about how enforceable are clauses like this when it is a role that the current employers would not be losing out in? I appreciate that it will be down to the exact wording to an extent which is why I am also going to get legal advice, but any general advice is welcomed.

[ComplianceLady]

Hello,

I head up compliance for a multi-national recruiter so perhaps I can help. As I understand it you are permanently employed by a business that supplies (staff or goods or services?) to a Government department. You are considering engaging directly with that Government department on a contract basis. Please let me know if I've misunderstood anything about the scenario.

It is comforting for the Government Department to assert that they have nothing to stop them engaging you directly. This would be the usual route for enforcement of any restrictions. Your current employer's options are broadly to enforce a penalty on the Government department (their client) or to sue you for breach of contract. The latter is difficult to pursue, rules governing restrictive covenants are fairly robust and individuals tend to have less resources to make it worthwhile. The former can be entirely unpalatable as it can sour the relationship.

Often with these types of issues it comes down to not what the contractual position is but the relationship between the parties and any loss perceived. The difficulty is, as you say, that you can't get any real certainty about action until after you've taken the plunge. It's therefore sensible to have a conversation with the Government department about what their stance might be if your employer attempts to enforce a penalty on them or on you personally, form there you can discuss with your employer if you feel you're in a fairly strong position.

Hope this helps.

Hi

I have a query about restraint of trade clauses that I was looking for some advice on or anyone with previous experiences of them. I will be seeking some legal advice in the New Year but thought some knowledge in advance may help.

I currently work as a permie for a supplier company based in a Government department and I have a 6 month restraint of trade clause in my contract. For external resources, the client either goes through suppliers for resources in certain areas of the business or get contractors in directly in other areas.

I have decided that I want to move into contracting next spring and have already had discussions with someone about a contract role that is being recruited for directly by the client. I have spoken to the team who deal with the recruitment and they have confirmed that the clause would not stop them recruiting me but I would have to deal with any legal consequences of taking the role.

My manager has suggested previously that the higher up levels of management would potentially take action if I were to leave for a role like that. I did suggest I could liaise with the relevant people to check in advance if they would for any specific roles, but was told I would have to just take whatever role I decide to and wait and see if any action is subsequently taken. I have heard indirectly that they have tried to enforce this once before at the same client and lost, but have not been able to verify that for sure and probably won't be able to. But I do know they have let others leave for similar roles without taking any action.

As the role is not 1 that would potentially be filled by my employers, that removes any argument about lost revenue which I would understand if I was taking a role they would otherwise fill.

So I was hoping that some people may be able to provide some general advice about how enforceable are clauses like this when it is a role that the current employers would not be losing out in? I appreciate that it will be down to the exact wording to an extent which is why I am also going to get legal advice, but any general advice is welcomed.