Can my employer prevent me from working for a competitor after I leave?

A restriction in the contract of employment preventing you from working for a competitor after leaving your current employment is called a 'restrictive covenant' or 'restraint of trade' clause.

It is not unusual to see a written term in the contract of employment limiting your employment by a competitor, or setting up on your own in competition, for a limited period and within a limited area.

Such 'restraint of trade' clauses will only be upheld in law if they can be shown to be reasonable (i.e. in duration and scope) in terms of protecting your employer's legitimate business interests and to be in the public interest.

The wider the scope of such a clause, the less likely it is to be enforced. Where a clause has been drafted too broadly, the courts will normally find it entirely invalid rather than accept part of it or rewrite it.

This kind of term is most likely to be found in employment contracts where the role involves sale or marketing, or in the contracts of senior employees who are in regular contact with the employer’s clients.

Note: This content is provided as general background information and should not be taken as legal advice or financial advice for your particular situation. Make sure to get individual advice on your case from your union, a source on our free help page or an independent financial advisor before taking any action.

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