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kmslaw, Solicitor
Category: Australia Law
Satisfied Customers: 210
Experience:  I have 15 years legal experience behind me and I graduated from the University of Sydney with First Class Honours in Arts/Law.
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There,I am based in Australia.I'm currently employed

Customer Question

Hi there,
I am based in Australia.
I'm currently employed full time but am looking to leave and go self-employed. I am looking for someone to read my employment contract and advise me on my non-compete clause and tell me what I can and cannot do.
The contracts says that i cannot compete for '12 months, or if not enforceable 6 months, or if not enforceable 3, or if not enforceable 2 months'.
Problem I have is that i am a consultant and not competing would effectively rule me out of a big chunk of work relative to my skill set. Whilst it is not my intention to actively 'compete' with my employer, I'm worried that 'technically speaking', any contracts i might win could be perceived as me having prevented my current employer from getting that work.
The issue is slightly complicated for me i think, because i am the only person at my company doing what i do. Therefore, my leaving could well result in customers simply cancelling their contracts with my current employer (because my current employer will not be able to service them), and seeking me out separately to deliver a package of work. A lot of the value in what i do is vested in me personally rather than the company - it's one of the reasons why i want to become self employed.
If i go self-employed i want to ensure that everything I do before leaving is fair by my current employer, whilst not ruling me out of work for any time after i leave. Basically, i don't want to steal any customers before i leave, but i don't want to find myself in a position where i couldn't accept work from a customer after i've left.
Submitted: 2 years ago.
Category: Australia Law
Expert:  kmslaw replied 2 years ago.
Hi my name is ***** ***** I am a NSW solicitor who is going to help you with your inquiry today.
As to whether it will be 2, 3, 6 or 12 months that you are forbidden doing the type of work that you do, you should get a written legal opinion considering case law in relation to the issue and your particular circumstances so as to protect your interest in that regard and to ascertain the length of time you need do wait. That is beyond the scope of this website as you would need to give extensive details about your current employment and case law would need to be researched and writing it up is the only way to protect you legally in the event of you being sued. It also protects you as the lawyer who gives the advice can be sued if they turn out to be wrong and negligent in giving you the advice (under their professional indemnity insurance, which is compulsory).
In relation to doing other things, I guess without knowing exactly what you do it's difficult to say what you can do, but if you could find something that is really to the side of what you are doing that would sustain you for even 2 months, if you got a legal opinion that says 2 months is all you need to avoid doing what you currently do, then you're sweet. One example is, when I set up my own law firm, I had to, for 12 months, not contact any of my clients from the previous law firm to ask them for work. But that didn't mean I couldn't seek my own clients, particularly in the field of practice I previously worked in. What I did is keep a list of my previous employer's cilents and once 12 months was up, I called them all. But in the meantime I had a lot of other work to do. I'm not sure if that translates to what you're doing but if you read the non-compete clause carefully there may be a loophole like this - you need to be creative with your thinking when reading the clause. I hope that is helpful - by the way, you can also get a written legal opinion as to the scope of your intended work.
I also assessed that my employer was unlikely to want to sue me because its clientele was extensive and its longevity with those clients was protected by a 12 month stipulation.
Incidentally, the clause in my non-compete framework also allowed those clients to approach me, rather than me approaching them, for me to do their work. This didn't happen but I was aware of it potentially working to my advantage.
If you are setting up your own business anyway sometimes it will take you 2 months or more to just set up let alone doing any similar work, unless you have things underway already (which incidentally would be a breach of your current employment contract so don't do that).
Let me know if you need further guidance.