Q&As

Where a contract prevents one party (A) from soliciting the employees of the other party (B) for a period of 12 months following the termination of the contract between the parties, is this effective to prevent the solicitation of an ex-employee of (B) who left (B) five months ago and is working independently and an ex-employee who has left B and set up as a consultant through a service company?

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Produced in partnership with Lynne Counsell of 9 Stone Buildings
Published on LexisPSL on 10/10/2018

The following Commercial Q&A produced in partnership with Lynne Counsell of 9 Stone Buildings provides comprehensive and up to date legal information covering:

  • Where a contract prevents one party (A) from soliciting the employees of the other party (B) for a period of 12 months following the termination of the contract between the parties, is this effective to prevent the solicitation of an ex-employee of (B) who left (B) five months ago and is working independently and an ex-employee who has left B and set up as a consultant through a service company?
  • Non-solicitation clauses
  • Drafting of non-solicitation clauses
  • Summary

Where a contract prevents one party (A) from soliciting the employees of the other party (B) for a period of 12 months following the termination of the contract between the parties, is this effective to prevent the solicitation of an ex-employee of (B) who left (B) five months ago and is working independently and an ex-employee who has left B and set up as a consultant through a service company?

Non-solicitation clauses

A restriction on ‘poaching’ employees is one type of restrictive covenant usually contained in commercial or employment contracts. The four types of restriction are as follows:

  1. non-solicitation: a business or former employee is prevented from approaching the clients or customers or employees of another business for a specified period

  2. non-dealing: such a clause is wider. It not only prohibits non-solicitation but also dealings between one party and employees or clients or customers of the other party

  3. non-competition: a party is prohibited from competing with the business of the other party in specified ways and for a specified period

  4. non-disclosure or confidentiality: the party cannot disclose to third parties confidential information or data about the other party

Such restrictions always have a time limit. If they are too widely drawn they will not be enforceable and deemed unreasonable. For further information, see:

  1. Practice Note: Post-termination restrictions—reasonableness

  2. Practice Note: Construing post-termination restrictions

  3. Determining whether restrictions are enforceable—overview

See

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