Competition clause in contract

S

Stephenkelly

Guest
Hi I have a competition clause in my current contract i.e. I cant move from my current employer to a competitor and work with the same clients. I am leaving the company after six months because I haven't enjoyed the time there but I have not secured a position yet (want to go away for a few weeks). The option may be there to work for a possible competitor in a different capacity. We would be catering for a different markrt and would be a provide a completly different service to some similar clients.

How do I stand?
 
Here' a tip.

I had a similar clause along with a confidentiality clause in a contract I once had with an employer. Elsewhere in the contract - in the termination section - it had a clause saying that this contract of employment can be terminated by either the company or the employee by giving one months notice in writing.

So, when I resigned from the company to take up a job elsewhere my resignation letter was dear company blah blah............."I hereby give 1 months notice that I want to terminate my contract of employment"......thank you etc .

And that was it. When a contract is terminated, the entire contract including every clause in it is terminated - this includes the competition & confidentiality clauses.
 
Thanks for the advice - what industry do u work in?
 
The company I mentioned above was a large multinational technology company. It c.10 years ago and I left to go into a different field of work. Even though I wasnt staying in the same industry, I decided that I did not want a confidentiality clause hanging over me for the rest of my career and didnt want any restrictions on joining a competitor in the event that things did not work out in the new job I was taking up.

To be honest, I dont think that the company was aware of the implications of the wording of my resignation letter. I handed it to my boss and she looked at it and passed it to personnel dept who put it on file. Boss and personnel staff arent lawyers and probably never read the small print in their own contracts, and as "I wish to terminate my contract on employment...." is the type of language you might expect to see in a resignation letter anyway, they didnt think anything of it. I left the company a month later on very good terms - they gave me a good written reference and even paid me a full bonus at the end of that quarter in spite of me only being there for 2 of the 3 months.

Though I did think at the time that this was a huge oversight on the companies part - this part of the contract was standard on all their contracts worldwide - 100,000s of employees. They were a company who had a lot of cutting edge technology and a large legal dept at HQ protecting their intellectual rights, patents etc.,
 
CsIrl,



I like it ..... , just goes to prove that contracts are not there to limit your employment prospects, or allow employers to dictate your future career.
 
Agree,
It's only when you resign that you discover how unfair these contracts can be.
 
I was under the impression that those clauses had no legal standing whatsoever. They might be able to block you working for a competitor for a certain period of time but they would have to pay you. I work in financial services and when I hand in notice, I am escorted off the premises straight away. They then pay me 1 months gardening leave during which I am not entitled to take up employment with a competitor. After that period though, I can work for whoever I like. Its a great system!
 
Sunny,


You are right, but the fact employers use these clause still proves they are an effective deterrent to their employees moving to competitors
 
It is incorrect to categorically state that competition clauses have no legal standing whatsoever . As I understand it, a Court will in particular circumstances uphold these clauses, but only those that are limited and reasonable in the circumstances of the particular case. Se for example [broken link removed]
 
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