Would This Clause Stand Up In Court?

[RATTER15]

A discussion with a colleague over our employment contract lead me to question one of the clauses.

This is the clause in question http://oi64.tinypic.com/213ouj4.jpg the company is a Care Agency working in the community. The query concerns a member of staff leaving the company and approaching some of our clients to work privately for them.

Would this part of the contract actually stand up in court?

[Jackdaw33]

Very likely, yes. It's called contract in restraint of trade and 6 months does not seem unreasonable.

[RATTER15]

Thanks JD, that is what I suspected.

[Jackdaw33]

You can see the reasoning behind it.

A employs B, trains B fully, then 12 months later B leaves to set up own business, taking with him/her half of A's clients. Not good for A.

[hc4361]

It's a very common clause and is enforceable.

[Zacs-Master]

And notoriously difficult to enforce
http://www.inbrief.co.uk/regulations/restraint-of-trade-clauses/

[Buenchico]

A useful article on the subject:
http://www.contractorcalculator.co.uk/contract_restrictive_clause_enforceable.aspx

[pixie374]

It's extremely difficult. As you know, we did exactly that ourselves, so I asked my dad who was a solicitor. He said they have to prove you've have had a detrimental effect and one or two are not going to make much difference to a massive company. The agency themselves told us it would not be worthwhile taking us to court and wished us luck.

[RATTER15]

Thanks Pixie.

[RATTER15]

Sorry, thanks all, some useful info there.

[Buenchico]

It's worth remembering that businesses who write 'golden handcuff' clauses into their employees' contracts often try to insert similar clauses into the contracts which they have with their clients, such as "I/We agree not to engage the services of any person formerly employed by The Company, in any role similar to that which they have performed for The Company, within six months of such a person leaving the employment of The Company".

Something like that might well be unenforceable in law but in can often be enough to deter their clients from taking on someone whom they previously received good service from through an agency.

[Jackdaw33]

Don't forget the 'Blue pencil' test. Courts can strike out parts of such clauses, leaving the remainder intact.