Restricting life after leaving
I set up a company business a few years ago and have recently lost members of staff who took clients with them. As the business evolves, I am aware there will be a higher staff turnover. Can I issue restrictive covenants to staff to control what they do after leaving and stop them taking clients with them?
It is tempting to draft restrictions broadly to capture every possible detrimental situation, but covenants must only go as far as necessary to protect legitimate business interests. If you go into heavy they are not enforceable You need to consider the geographical area and duration covered. You also need to think about the nature of your business and the staff members’ responsibilities. You can’t stop someone from joining a rival business. Restrictions that are worded too broadly will be invalid. Often 2 years and a 5 miles from the company’s premises will work but it depends on the business.
Take expert advice Hylton-Potts offer fixed fees for drafting such agreements