The US has introduced a ban on certain post-termination
covenants with hopes of increasing innovation. This article
considers how the ban will work, who is excluded from it, and the
UK government's stance on non-competes.
Most of us will have heard about post-termination restrictive
covenants in some shape or form, or have perhaps even been subject
to one.
These clauses are inserted into an employment contract to
prevent an employee from acting in competition with the business
for a defined period of time (typically three – 12
months) after the termination of their employment.
There are different types of restrictions available, the most
common being:
- obligations not to be involved in any capacity (whether as
employee, consultant, shareholder, etc.) with any business in
competition with the employer (referred to as
“non-competes”); and
