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ARTICLE · 17 OCTOBER 2011

The HR Space: Split Decision On Post-Employment Restrictions

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Canadian courts continue to struggle with clauses in employment contracts that contain post-employment non-competition and non-solicitation clauses, known as "restrictive covenants".

CanadaEmployment and HR
Thora Sigurdson
Thora Sigurdson
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The HR Space is edited by Lyne Duhaime, Karen M. Sargeant and Brian P. Smeenk.

Canadian courts continue to struggle with clauses in employment contracts that contain post-employment non-competition and non-solicitation clauses, known as "restrictive covenants".

The recent split decision of the Alberta Court of Appeal in Globex Foreign Exchange Corporation v. Kelcher, provides an interesting reminder of the uncertainty in the law in this area. It also provides good lessons to those who want employees to agree to such restrictions.

In Globex, three employees had contracts with non-competition and non-solicitation clauses. For one employee, the terms were included in the hiring contract. The other two were asked to agree to the restrictions after they were hired. All three later left Globex and joined a competitor.

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