Non-competition clause

shortlegs

I wonder can anybody tell me if they have any experience of non-competitive
clauses in their contracts? After working with my company for many years I find out on reading my latest annual contract through (it was NOT explained to me) that this clause is now in it.
I'm refusing to sign and they're saying "fine, we'll just reduce your agreed salary accordingly".
Can they do this?

Pablo

hi shortlegs,

As far as I know, they can stipulate that you can't work for a competitor at the same time you are working for the current company. And they can request you not to share trade secrets, but telling you, that you can't ever or only after 3 years of other work, work for a certain company, this might not be defendable in court. Even if you sign it.

Alas I am not a employment lawyer, so take my advise with a little salt.

connundrum

I used to work for CarBuyersGuide, and they made us sign a contract stating that we wouldn't work for AutoTrader (or the likes) for a period of up to a year of leaving CBG (could have been more). I signed it as I had no notion of going anywhere else anyway, but I would have thought it wierd if they threatened to reduce my salary by not signing it.

Surely that'd make you more likely to leave and join the competition - which is what they'd be trying to avoid in the 1st place??

shortlegs

Thanks Pablo and Connundrum for your interest.
Connundrum - the 'salary' I refer to is what is being offered in the new contract.
Anyway I think Pablo is right - they can put it in my contract, so I think I will sign and not let it become a major issue, anyway I do not think they can enforce it in reality.
But what really irks me is the way they sneaked it into my contract after 6 weeks negotiations - of course it might have slipped their minds.:(

bpmurray

It's not legally enforceable unless you're at director level or above, so don't worry about it. Tell your boss this when you sign it. There are plent of legal precendents for this, and the company has *never* won.

Note that you can't take work materials with you, though, when you leave.

mountainyman

bpmurray wrote:

It's not legally enforceable unless you're at director level or above, so don't worry about it. Tell your boss this when you sign it. There are plent of legal precendents for this, and the company has *never* won.

Note that you can't take work materials with you, though, when you leave.

Don't tell your boss that when you sign it. It is a meaningless severable clause. Except that you cannot set up your own business by stealing clients from your employer.

MM

Sleepy

Interesting, I know my contract has a clause preventing me from working for a customer or supplier within the first year of leaving the company. Is this actually meaningless?

bpmurray

>> Interesting, I know my contract has a clause preventing me from working for a customer or supplier within the first year of leaving the company. Is this actually meaningless?

Unless you are privy to very important, dusiness-defining, secret development plans (that's assumed if you're a director or VP), then it's totally meaningless.

mountainyman

Sleepy wrote:

Interesting, I know my contract has a clause preventing me from working for a customer or supplier within the first year of leaving the company. Is this actually meaningless?

Unless you are a director it is meaningless. Alternatively if you are technically self employed you must not build your own business by stealing your employers customers while he is paying you.
MM

Iago

mountainyman wrote:

Unless you are a director it is meaningless. Alternatively if you are technically self employed you must not build your own business by stealing your employers customers while he is paying you.
MM

The advice that these clauses are meaningless are not quite true. They CAN and sometimes will get an injunction preventing you from starting in your new place of work pending the outcome of a court case regardless of your level within the company. I'm going through this process myself at the moment and have contracted a solicitor to help me with the issues.

The odds are very high in your favour that in the event of a court case you will win and they will lose, but that will only take place after around a 3 month period from the date of the injunction and in the meantime you may not work or get paid!

So it is very dependant on what you do, the business your current employer is engaged in and the role that you are going to, but I wouldn't say these are meaningless.

Another girl left my company at the same time and she is currently serving a 4 month gardening leave period and a girl I worked with previously has just left my new company and is also currently serving a 3-month gardening period. These clauses are enforcable and will in some cases lead to injunctions.

Red Alert

A lot of the court's decision is apparently based on the employee's right to earn a living, and that this sort of clause is an undue restraint of trade.

This often comes up in the music business, George Michael's spat with Sony being the obvious example.

(not a lawyer)

jimmycrackcorm

Unless it can be clearly shown that moving to a competitor will cause the company damage, the clause is unenforceable.

I'm unsure what the op means about having his agreed salary reduced - obviously if it is his current salary then that is court actionable. If it is a proposed new salary then obviously it's a trade-off.
You could always argue that you can reduce your performance in line with the salary reduction.

shortlegs

yes, it's the proposed salary they're threathning to reduce.
No I will continue with the effort level regardless - it might be perceived by future employers (competitors?:D ) as been unprofessional

TempestSabre

shortlegs wrote:

...they're saying "fine, we'll just reduce your agreed salary accordingly"...

I'm curious what monetary value they put on it. Can you ask what it is and you'll decide if its worth it?