Lecture notes
seminar notes on employment law
- Module
- Employment Law
- Institution
- Nottingham Trent University (NTU)
seminar notes about employment law with some practise answers
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Practice Questions for the Second Teaching Weekend –EMPLOYMENT LAW
Restraint of Trade Clauses
Reading:
Smith & Wood's section on “Express Terms” – “Restraint of Trade” –
Question One – Robin and Xcel IT plc
In 2016 Robin started work focity as a computer engineer.
In 2019 Robin is sent a “new contract of employment” which offers him a
number of employee benefits such as private medical insurance which
Robin makes use of.
His “new contract” also contained the following clause:
“For three years after the ending of the employment, the employee
agrees not to be associated with a business in competition with Xcel IT
plc within a 25 mile radius of central Nocity.”
Robin has some contacts at another IT company, Chipits Ltd, which is
based in Yicity, which is 20 miles from Nocity.
In October 2021, Robin is told that he must transfer to London, some
120 miles away from Nocity, and that he must go immediately because of
a number of new contracts to be worked on at the London office. Robin
does not wish to move and contacts Chipits to find out if they have any
, vacancies. He is invited for an interview and is offered a job. As a result
of this he terminates his contract with Xcel by giving due notice.
Advise Xcel.
My answer:
- Xcel included a restrictive covenant in the new contract which is an express
clause, restricting the employees ability to work for a competitor after the
employment has come to an end.
- A non-competition clause was expressly given in the new contract and Robin is in
a breach of that clause by not only going to a competitor of Xcel but also, he is
not within the 25 miles radius, he is 5 miles of the contractual perimeter
- Xcel must show that he has legitimate business interest requiring protection, the
PTC is reasonably necessary to protect the legitimate business interest and that
the PTC goes no further than reasonably necessary
- There must have been a clause which gave the right to move Robin to another
location and if there is and he refuses, then that is a breach on his behalf,
providing that xcel took reasonable measures in the transfer such as giving
reasonable times notice to move. Unfortunately, xcel did not give reasonable time
here because they told robin that he must move immediately
- Robin should not be contacting a competitor company only because he is unhappy
in his employment as that is a breach of mutual trust and confidence. Instead, he
should have confided in his employer
Class Answer:
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