Quick Answer: Are Restraint Periods Enforceable?

Can an employer stop you from working somewhere else?

When you leave a job some employers will say you can’t work for a similar business for a certain amount of time.

Your contract might restrict what work you can do next, but your employer can only do this if it’s needed to protect their business.


What voids a noncompete agreement?

Voiding a non-compete contract is possible in certain circumstances. For instance, if you can prove that you never signed the contract, or if you can demonstrate that the contract is against the public interest, you may be able to void the agreement.

Can my boss sue me for taking clients?

However, you may still be sued for breach of contract, tortious interference with a contractual relationship, or other type of causes of action. You should contact an attorney knowledgeable in this area, such as myself, as soon as possible to evaluate your claim and protect yourself.

What does Restraint Period mean?

A restraint clause will normally refer to both a geographical area and also to a time frame. For example, the clause may refer to an employee not being allowed to work in the Hobart area for a competitor for a period of 12 months.

What is a reasonable restraint period?

Generally, non-solicitation clauses are easier to enforce than non-compete clauses. While there is no hard and fast rule, a reasonable restraint period (for non-solicitation) is often considered to be between three and 12 months after termination, subject to industry-specific and individual considerations.

Are restraint of trade clauses enforceable in Australia?

The common law doctrine of restraints of trade captured in the Restraints of Trade Act 1976 (NSW) (relevant in this case) and the Competition and Consumer Act 2010 in Australia renders any provision which imposes restrictions on an individual’s freedom to trade or take employment illegal and unenforceable, unless it …

How do I get around restraint of trade?

You could potentially save a lot of time and money by following these steps:Obtain Legal Advice. Yes, this one sounds obvious. … Review the Clause Carefully. Restraints of trade are not a ‘black and white’ area of the law. … Don’t Confuse it With Other Contractual Clauses. … Advise Your New Employer.

Can my company sue me?

The short answer is yes, and these are the most common reasons an employer can sue an employee successfully. While it is more difficult for an employer to sue an employee than vice versa, there are many valid legal reasons that an employer may bring a cause of action against an employee (or ex-employee) and win.

What is a reasonable restraint of trade?

What is a restraint of trade clause? A restraint of trade clause limits the ability of an employee to accept future employment which could be to the detriment of their current employer – usually because it is a competitor and the employee has access to confidential information.

Does restraint of trade hold up in court?

The court held that a restraint of trade agreement is enforceable unless it is shown to be unreasonable – and the onus of showing that it is unreasonable rests upon the person alleging it.

Can my employer tell me I can’t have a second job?

Employers often have the ability to restrict employees from working a second job or starting a side business. … If you work a second job, the answer is yes—even if you don’t technically do that work at night. Plenty of employees work second or even third jobs to make ends meet or explore other career options.

Can you get out of a non compete?

Not necessarily. Fortunately for you, courts have recently limited the power of non-compete agreements to protect employees’ rights, making it possible (though not guaranteed) for you to get out of your non-compete. For a non-compete agreement to be enforceable, it must first be reasonable.

Can my company sue me for going to a competitor?

A noncompete agreement is a contract, and if you break or “breach” it, your former employer can sue you for damages. … Your old employer may file a lawsuit against you alone if you started working for a competitor or started your own competing business.

What happens if you breach a non compete?

In this context, employers may include an amount that the employee must pay if they breach the non-compete agreement with their employer. Because liquidated damages are part of the contract, the new employer will not have to pay liquidated damages unless they signed a contract directly with the former employer.

Is restraint of trade illegal?

Overall, restraint of trade is any activity that prevents someone from doing normal business without restraints. … The Sherman Antitrust Act specifically includes a section on restraint of trade and declares it illegal.