Agreements in Restraint of Trade
A non-competition agreement or a covenant to not compete is generally viewed by the law as an agreement or covenant in restraint of trade. Any such agreement or covenant is accordingly subject to considerable scrutiny and vulnerable to unenforceability. In particular, the Courts tend to consider whether the terms of the non-competition agreement or covenant can be said to be fair and just in the circumstances. Specific consideration will be given to how ambiguous and far reaching the restrictive covenant is stipulated. Ambiguity and far reaching provisions whether in terms of the non-competition territory or timeline restricting non-competition will tend to weigh against legal validity.
A non-solicitation agreement or a covenant not to solicit is also generally viewed as being in restraint of trade. Agreements or covenants requiring the non-solicitation of an employer’s staff or clientele, however, are less controversial than their non-competition counterpart given that they present less of a restraint on trade.
All the same, both non-competition and non-solicitation provisions must be carefully formulated in order to ensure same are legally compliant.
Whether you are an:
- employee being asked to agree to an agreement in restraint of trade;
- employee concerned over your rights subsequent to having contractually agreed to restrictive covenants in respect of competition and solicitation;
- employer seeking to impose restrictive covenants on your employee base; or
- employer seeking to enforce restrictive covenants considered to have been breached by an employee or former employee,
call on the lawyers at RV Law for professional and skilled representation.