The HR Space is edited by
Louise Béchamp,
Karen M. Sargeant and
Brian P. Smeenk.
Non-competition clauses in employment contracts are difficult to
enforce in Canada. Courts tend to regard them as unreasonable
restraints on trade. They will not enforce them if they are
ambiguous. Nor will they generally use a "blue pencil" to
sever ambiguous words. This was made clear in the recent appeal
court decision in Veolia ES Industrial Services Inc. v.
Brulé (PDF).
The Facts
Mr. Brulé was the President of Veolia ES Industrial
Services Inc. ("Veolia"). His three-year employment
agreement dated January 1, 2004 allowed him to resign on 180
days' notice. It had a non-competition clause that applied
following Brulé's departure, "for two years
commencing on January 1, 2007". Brulé
terminated the agreement early on July, 7, 2004. The Company paid
his salary until January 3, 2005. Later in 2005, Brulé
competed against Veolia for a public tender. He won. Veolia sued
him.
