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ARTICLE · 19 SEPTEMBER 2017

Non-Solicitation Provisions: Go Narrow Or Risk Unenforceability

Employers need to protect their customer base. Employees need to retain control and autonomy over their lives.

CanadaEmployment and HR

Employers need to protect their customer base. Employees need to retain control and autonomy over their lives. The potential conflict between basic tenets of the employer-employee relationship are readily apparent in Donaldson Travel Inc v Murphy, 2016 ONCA 649 [Donaldson Travel]. In that recent decision, Ontario Court of Appeal emphasizes the difference between non-solicit and non-compete clauses in employment agreements, and remind us that courts prefer not to interfere with an individual's ability to earn a living any more than is reasonably necessary.

While post-termination non-competition clauses that restrict individuals from working in the same industry as their former employer may be enforced by Canadian courts in some cases, they are considered prima facie unenforceable for restraint of trade. By comparison, if sufficiently limited in scope, post-termination non-solicitation clauses are generally perceived as more reasonable. They allow individuals to

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