Call For Evidence Into Non-Compete Clauses

The Government has launched a call for evidence to look at whether post-termination restrictions in employment contracts act as a barrier to employment, innovation and entrepreneurship.

The courts will only enforce post-termination restrictions, including non-compete clauses, if they are reasonably necessary in order to protect a legitimate business interest. Currently, many employers include in their employment contracts a suite of post-termination restrictions in order to protect their business. This may include restrictions on soliciting business from customers or suppliers, or from poaching senior staff.

The Call for Evidence has not suggested a ban of post-termination restrictions at this stage. Instead, it is intended to obtain views on whether these clauses have a detrimental impact on "opportunities to innovate and grow".