Look Before You Leap ' Does Your Employment Contract Prevent You From Starting A New Job?

• Published date: 30 April 2021
• Subject Matter: Employment and HR, Contract of Employment, Health & Safety
• Law Firm: Brahams Dutt Badrick French LLP
• Author: Mr Tom McLaughlin

With the economy entering what we hope is a recovery phase we are seeing an increase in senior employees looking to start new jobs running up against restrictive covenants in their employment contracts.

If you are in a role where your employer may want to prevent you from competing with them (for example a senior management or sales role) then you should take advice on your obligations at an early stage because:

• Restrictive covenants are not always unenforceable: Post termination restrictions are only enforceable if they are reasonable and go no further than is necessary to protect the employer's legitimate business interest. However, what that means in practice requires a detailed review of your role and the confidential information clients etc. you interact with.
• You need the complete picture: In addition to your employment contract there may also be post-termination restraints in other documents you have signed up to, such as share schemes or other incentive plans. These documents may well be subject to foreign law, adding a further layer of complexity We frequently work with foreign qualified lawyers to assist clients in this situation.
• The documents are not the full story: You will also owe a series of implied obligations to your employer depending on your seniority, that must be carefully navigated. What for example, can you say to clients about your move to a competitor without getting into difficulty? What can you say on LinkedIn?
• You might be able to escape your restrictions (and your notice period) altogether: This can be the case if you have been 'constructively dismissed' by your employer but your resignation must be handled promptly and in the right way for this to work.
• You need to get your new employer onboard Understanding your...