Moving to a competitor—issues for employees
Moving to a competitor—issues for employees

The following Employment practice note provides comprehensive and up to date legal information covering:

  • Moving to a competitor—issues for employees
  • Contract of employment and other documents
  • Whether restrictions agreed and incorporated
  • Other duties
  • Confidentiality, duties and restrictions: enforceability
  • Constructive dismissal
  • Dealings with new employer
  • Disciplinary action by the current employer
  • Planning and record-keeping
  • Right to be accompanied
  • More...

This Practice Note considers the legal and practical issues that may arise when an employee wishes to leave his current employment and move to work for a competitor. The note envisages that the competitor may be a pre-existing organisation, or a new business set up by the employee (acting alone, or with others, such as fellow employees) to undertake the competitive activity.

Contract of employment and other documents

The first step when advising an employee who is considering leaving his current employee for a competitor is to consider the terms of the contract of employment, and to ascertain the duties and restrictions that apply to the employee.

Ideally, the employee will have been well-advised when he entered into the contract in the first place, as, depending on the relative bargaining power of the parties, this is obviously the best time to negotiate any duties provisions and post-termination restrictions so that they are a sensible compromise between the employer's interests and those of the employee.

However, in many cases, the employee will not have scrutinised the post-termination restrictions at all, or will have accepted them even where they are very wide, on the basis they can be disputed at the point of the employee leaving to compete. This is unwise:

  1. generally the employer will have more funds available for litigation and even where clauses are unreasonable, can push the

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