BGN Entrepreneur

Most employees have restrictions in their contracts. Employers are now more ready than ever to enforce these restrictive covenants due to the drop in retail spending and the difficult economic climate. The last thing they want in the competitive market is to face competition from an employee they have trained and invested in to start stealing their business.
Usually, restrictive convenant will be in the contract of employment , or employee handbook or even in a separate agreement. There are three main kinds of restrictive covenant:
1. Those that prevent one from approaching clients of their former employer;
2. Those that prevent one form poaching employees;
3. Those that prevent one from competing against their former employer generally.
The last one is most difficult to enforce and will only be upheld by the courts if it is deemed to be reasonable.
Restrictive covenants vary in length from six months to a year, and carry a lot of legal weight. If you are looking to quit your current job and start a new business by yourself, you need to be aware of the legal rights your former employers have and your responsibilities involved. If you decide to ignore the restrictive covenants, your former employer could not only get a High Court injunction to close your business but could claim damages for loss of income.

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