Enforcing Post-termination Restrictions In Employment Contracts

Employers may consider utilising post-termination restrictions ('PTR') in employment contracts to safeguard their business. Specifically, PTR is a common legal tool to prevent senior employees from damaging the interests of the company, actions include working for competitors, soliciting clients or suppliers, and poaching employees after departing the company. Employees under a PTR clause can be limited from joining competitors or activities within a specified period and geographical radius.

In Hong Kong Special Administrative Region (HK SAR), the court shall enforce a PTR-based employer's justification of its (PTR) reasonable circumstances to protect a legitimate business interest. Therefore, PTR is highly sensitive to the individual's current position and responsibilities within the company. Precedents can indicate whether the PTR is enforceable, however shall not be viewed as determinative. Generally, the courts will consider the following principles when