UK Employment Law
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It is common for employers to want to protect their business interests from unfair competition by current and ex-employees. This applies especially to employees who have knowledge of sensitive and valuable information, have considerable influence over the workforce or have strong customer connections. However, at the same time it is in the public interest to ensure that employees are free to move between employers and use their skills, knowledge and experience in a new setting.
Whilst employers try and impose certain restrictions on their employees, under the doctrine of restraint of trade, any contractual term which seeks to restrict an individual's freedom to work for others or carry out his trade or business is illegal and unenforceable. The exception is when the employer can show it has a legitimate business interest that requires protection.
Legitimate business interests (LBIs) are commonly accepted to include:
An employer cannot impose a restrictive covenant merely to stop someone competing, but it can seek to stop that person using or damaging something which legitimately belongs to it, such as an LBI.
Non-competition covenants will generally be unenforceable, unless the employer can justify their use. As a matter of general law, once they leave employees are restricted from disclosing confidential information amounting to a trade secret. As with non-solicitation covenants, the restriction must be for a limited time. The geographical extent of the limitation must also be considered. Worldwide or covenants without limits have been held to be unenforceable, but more specific restrictions can be enforceable if considered reasonable in the circumstances.
In your case there was no geographical extent of the restriction and such a wide covenant is likely to be unenforceable. However, one potential issue is whether the pricing strategy you have used is something that can be considered a trade secret or confidential information belonging to that particular employer and whether you should not have used it for your own gain and especially to act in competition with them.
Please let me know if this has answered your query or if you need me to clarify anything else for you in relation to this?
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