ARTICLE · 08 AUGUST 2014

The servant of two masters: Competing employees and poorly drafted restraints

Clayton Utz

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Employers can stop their employees from competing in their own time through carefully drafted contractual restraints.

AustraliaEmployment and HR

Michael Byrnes (Formerly With Clayton Utz)

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Key Points:

Employers can stop their employees from competing against them in their own time through carefully drafted contractual restraints.

It's not uncommon for employees to seek work from two or more employers, which could be in the same industry and target the same consumer market. This can give rise to doubts (whether valid or not) that the employee may not be able to devote himself/herself to both employers with the utmost of good faith and fidelity.

In Adidem Pty Ltd T/A The Body Shop v Suckling [2014] FWCFB 3611, the Full Bench of the Fair Work Commission affirmed that it was unfair for The Body Shop to dismiss an employee engaged in out-of-hours work for a competitor, PartyLite Pty Ltd.

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