The Court of Appeal found that the non-competition restriction was too broad. As a result, the entire clause was not valid. The High Court/Trial Court found that the non-competition clause did not prohibit the applicant from holding shares in competing companies and therefore had no reason to address the issue of severance pay. Id. to [16]. The Court of Appeal not only set aside the court`s decision, but also rejected the company`s assertion that it should simply “or be interested” in the party to the non-competition clause and maintain the agreement on its remaining terms. Id. to [17]. If you are concerned that your plans to start a business may be contrary to the non-compete agreement, you should seek specialized legal advice to ensure that you understand the potential risks. It`s best to get an advisor before you quit or invest in your new business.

If there is a non-compete clause in your contract, you may be prevented from entering the business on your own behalf. It depends on whether the clause has actually been agreed, whether it is necessary to protect your employer`s legitimate business interest and whether it is appropriate. Finally, it may depend on why you want to quit your job. The facts are simple: Ms. Tillman wanted to work for an EZL competitor, but she was subject to a competition restriction, as follows. The applicant joined Egon Zehnder in 2004 as a highly paid financial services advisor. Id. to [5]. At the time, she signed a non-competition with five restrictions for the six months after her resignation. Id. In particular, the applicant agreed not to attempt to remove employees from certain executive positions of the company; Request or deal with specific service providers Interfering with the company`s suppliers Use a name that is probably confused with a business name or “to engage or be involved, directly or indirectly, in a company or company in competition with one of the company`s companies.” Id.

to [6]-[8] (add the mention). More than ever, very careful preparation is needed to ensure that any restriction of competition is properly assembled and that, when broad, it specifically “breaks down” the ownership of shares in a competitor. A non-compete clause, also known as a “non-competition clause,” is a clause in an employment contract that prohibits a worker from competing with a former employer for a period of time after the worker leaves. Other common restrictive agreements are designed to prevent the former employee from recruiting or exchanging important clients or employees of the company after they leave. On appeal, the Supreme Court justices unanimously ruled that the non-compete clause in its form was an unenforceable commercial restriction; but this separation from the offensive term was appropriate, as it could be obtained without altering the overall effect of the agreement. EZ opened proceedings in which it asserted that Ms. Tillman was violating her non-compete clause through her activities for a competitor. For all the reasons mentioned above, we have therefore long recommended that employers, when developing a restriction on competition, explicitly exclude all minor participations of the worker as an investment.

There is no doubt that Tillman improves the chances of British employers imposing non-competition against an outgoing worker. However, for four main reasons, employers should continue to carefully define the terms of non-competition prohibitions in order to avoid disputes over whether to separate.