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Sector | Common Duration | Typical Scope | Usual Geography | Enforceability Issues |
|---|---|---|---|---|
Law Firms | 6–12 months | Clients, team moves | UK/EU | Partnership deeds, team moves |
Investment Banks | 6–12 months | Deals, client lists | Global/EMEA | Deferred comp, bonus timing |
Tech Companies | 3–12 months | IP, product teams | UK/EU/US | LTIP vesting, know-how vs secrets |
Consultancies | 6–12 months | Client poaching | UK/EU | Project lists, public domain clients |
The Basics: What You Need to Know Before You Panic
Not all restrictive covenants are enforceable.
The law starts from the position that any clause restraining trade is void unless the employer can justify it as reasonable and necessary.Reasonableness is judged by:
Scope (what you’re prevented from doing)
Duration (how long it lasts)
Geography (where it applies)
Legitimate interest:
The employer must show the clause protects something real—like client relationships, confidential information, or workforce stability.
Sector Examples:
Law Firms: Partnership deeds may restrict team moves for 12 months, but courts will ask if the whole team is really at risk.
Investment Banks: Global non-competes are common, but rarely survive unless the banker had access to truly global, sensitive deals.
Tech Companies: Non-competes targeting “all product development” are often struck out unless the employee had access to core IP.
Consultancies: Client restrictions must be limited to clients you actually worked with, not the firm’s entire client base.
Common Ways Employees Win (or Defend) These Cases
1. Too Wide or Vague
Courts look for overreach:
12-month global bans for junior or mid-level staff are rarely upheld.
Clauses covering “all business activities” are usually struck out.
Example:
A tech product manager’s 12-month non-compete covering all of Europe was struck out as excessive.
2. Delay by Employer
If your employer waits weeks or months to act, the court may refuse an injunction.
Example:
In Planon Ltd v Gilligan, the employer’s delay of several weeks was fatal to their case.
3. No Benefit for Signing (“Consideration”)
If you signed new or tougher restrictions without a pay rise, bonus, or promotion, you can argue the clause is unenforceable.
Example:
A solicitor promoted to “senior associate” but given no pay rise, yet required to sign stricter covenants, successfully challenged them.
4. Public Domain and Know-How
You can use your general skills, experience, and knowledge—even if gained at your old job.
Only genuine trade secrets (like a confidential client database) are protected.
Example:
A departing analyst who used their memory of industry contacts (all available on LinkedIn) was found not to have breached any enforceable restriction.
5. Unclear or Poorly Drafted Clauses
Ambiguous clauses or those covering “all business activities” are usually struck out.
Example:
A non-compete clause that prevented a compliance officer from working “in any capacity” for any financial services firm was struck out as too vague and wide.
Top 5 Mistakes Employees Make When Challenging Covenants
Assuming all covenants are enforceable.
Failing to preserve emails and documents about the covenant.
Not challenging vague or overbroad clauses.
Ignoring the importance of delay by the employer.
Admitting liability or agreeing to undertakings too quickly.
Evidence That Helps Employees
Your Contract:
The full employment contract, including all schedules and amendments.Emails and Correspondence:
Especially about negotiation or signing of the covenant, or promises made.Job Descriptions:
Both old and new roles—showing differences can help defeat a non-compete.Client Lists and Public Sources:
Evidence that client details are in the public domain (e.g., LinkedIn, Companies House).Mitigation Evidence:
If accused of poaching, keep records of how you approached new clients (e.g., only using public information).Timeline of Events:
When you left, when you joined the new employer, and when your old employer took action.
What to Do If You’re Threatened With Legal Action
Don’t Panic:
Most cases settle before court. Many covenants are unenforceable.Preserve Evidence:
Save all relevant emails, contracts, and communications.Respond Promptly:
Acknowledge receipt, but don’t admit liability or agree to anything immediately.Seek Advice:
If you’re in a regulated sector (like banking or law), check if your new employer offers legal support.Consider Negotiation:
Sometimes, offering a limited undertaking (e.g., not contacting certain clients for a short period) can resolve matters quickly.Challenge Delay:
If your old employer waited weeks to act, highlight this in your response.
COT3 Meaning & Settlement Process (Acas) is best understood alongside Without Prejudice conversations in employment law for a full picture of confidential negotiations.
Typical Outcomes and What to Expect
High Settlement Rates:
Over 80% of restrictive covenant disputes settle before trial, often after an initial exchange of letters or at the interim injunction stage. Settlement might involve agreeing not to contact certain clients for a short period, or a limited non-compete in a specific region.Court’s Approach:
The High Court will only enforce a covenant if it is satisfied the restriction is reasonable and necessary to protect the employer’s legitimate interests. The court will not enforce a clause simply because it was agreed in a contract—reasonableness is always tested.Costs and Risks:
Legal costs for a single injunction hearing can range from £30,000 to £50,000 per side. If the employer loses, they may be ordered to pay your costs. If you lose, you may have to pay theirs, but this is rare if the clause is genuinely too wide or the employer delayed.Realistic Outcomes by Sector:
Law Firms: Team move restrictions often settled for a shorter period or limited to named clients.
Investment Banks: Global non-competes frequently reduced to UK or EMEA only, or struck out entirely.
Tech Companies: Non-competes narrowed to core IP or product teams, with “all business activities” clauses struck out.
Consultancies: Client restrictions limited to clients you actually worked with, not the entire firm’s client base.
Examples
Junior Manager’s Non-Compete Struck Out:
A tech manager’s 12-month non-compete covering all of Europe was struck out as excessive, allowing them to join a competitor within weeks.Sales Director Settles for Shorter Restriction:
A financial services sales director faced a 12-month non-solicitation clause. After evidence showed most clients were long-standing and had approached him, not the other way round, the case settled with a three-month restriction on only two clients.Employer’s Delay Fatal to Case:
A solicitor moved to a rival law firm. The former employer waited two months before taking action. The court refused the injunction, citing the delay as evidence the risk was not urgent.
Checklist: Preparing Your Defence
Gather your employment contract, partnership deed, or equity award letters.
Collect all correspondence about the covenant or your departure.
List your old and new job duties—highlight differences.
Save evidence of how you found your new role (headhunter, public advert, recruiter emails).
Keep records of client approaches and communications.
Note any delay by your former employer in taking action.
Prepare a timeline of events from resignation to present.
Final Thoughts
Most restrictive covenant disputes are resolved without a trial. The law is on your side if the restriction is too wide, you received no benefit for signing, or your employer delayed. Being proactive, gathering evidence, and understanding your rights can make all the difference. In most cases, a pragmatic settlement is possible, and your career need not be derailed by an overreaching clause.
Disclaimer: This content is for general information only and does not constitute legal, financial, or tax advice. Outcomes may vary depending on your individual circumstances.
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