business clients

Confidentiality and restrictive covenants

Companies need to take all reasonable steps to protect their confidential information and trade secrets. To do this they must ensure that employment contracts contain suitable protection by way of confidentiality clauses and restrictive covenants.

A contractual term restricting an employee's activities after termination is void for being in restraint of trade and contrary to public policy, unless the employer can show that:

it has a legitimate proprietary interest that is appropriate to protect; and
the protection sought is no more than is reasonable having regard to the interests of the parties and the public interest.

If there is a legitimate interest to protect, the employer should only impose a restriction that is no wider than reasonably necessary to protect that interest. This will involve limiting the covenant not only by reference to the restricted activities themselves but also by reference to the period and (if appropriate) the geographical extent of its application. Failure to do so may result in the covenant being treated as having too wide a scope and being, therefore, potentially void.

We can draft bespoke confidentiality provisions and restrictive covenants which cover:

poaching of employees
non-dealing with competitors
non-competition
non-solicitation of clients

These restrictions can apply both during employment and for a period after termination of employment.

We can advise on how to deal with suspected breaches of post-termination restrictions and we can where appropriate obtain High Court injunctions to enforce restrictive covenants and pursue associated damages claims.

For further information or assistance please contact Jo Cullen, the Employment Partner on 020 8549 5186 or employment@howell-jones.com.

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