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Employment solicitor Chris Hadrill offers advice to employees who have been dismissed but have restrictive covenants in their contract of employment

Q. I have been dismissed by my former employer and have made a claim for unfair dismissal in the employment tribunal. However, I think I am stopped from obtaining new employment in the industry that I worked in because of restrictive covenants in my contract of employment. Do these covenants still have effect if I’ve been unfairly dismissed, as I’m claiming?

Restrictive covenants are contractually-binding promises not to do something. In an employment context they’re often known as “post-termination restrictive covenants” – as the name suggests they attempt to bind an employee not to do particular things after that employee leaves their employment. Generally, post-termination restrictive covenants attempt to bind the employee in some or all of the following ways: not to compete with their employer; not to solicit former clients and/or employees; not to misuse confidential information; and/or not to deal with former clients (among other things).

The effect of the restrictive covenants in your contract of employment will depend upon what those restrictive covenants actually are. If there is a non-compete covenant in your contract then this will generally stop you from competing in a particular manner with your employer for a particular time and in a particular geographical area after your employment ends. This can be, as you can imagine, quite restrictive and may stop you from obtaining employment for a period of time after you leave your job.

If you have been unfairly dismissed from your job (but not wrongfully dismissed or in any other way in breach of your actual contract) then the restrictive covenants will still generally take effect – unfair dismissal is a statutory claim and therefore an unfair dismissal will not breach your contract of employment, releasing you from the restrictive covenants. In order to try and argue that the manner of your dismissal has breached your contract of employment (and that you’re therefore not bound by the covenants) you may wish to rely on facts which demonstrate that there has been a breach of your contract – such as a failure to pay you adequate notice pay or a failure to pay you wages that you are owed (such as, for example, commission owed). However, although the benefit of such an argument is that you can potentially obtain release from any restrictive covenants, there is also the burden that such a line of argument can open you up to a counter-claim in the employment tribunal for negligence and/or breach of contract. The benefits of such an argument must therefore be weighed carefully against the potential burdens.

Generally, a “simple” unfair dismissal claim will not allow an employee to argue that they are released from any restrictive covenants in their contract of employment – the employee will instead need to argue that there has been a repudiatory breach of contract by their employer which releases them from the effect of any covenants. However, and as above, this may be a risky argument – it is therefore advisable that an employee obtain suitable legal advice from a specialist if they think that they’re bound by restrictive covenants.

About Chris Hadrill

Chris is a specialist employment lawyer at Redmans. He specialises in contentious and non-contentious employment matters, including breach of contract claims, compromise agreements and Employment Tribunal cases. He writes on employment law matters on a variety of websites, including Direct 2 Lawyers, Lawontheweb.co.uk, LegalVoice, the Justice Gap and his own blog. Contact Chris by emailing him at chadrill@redmans.co.uk

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Anonymous

As with All solicitors advice without consequence but understood and communicated my legal position

Posted 5 days ago

Anonymous

Prompt, professional and excellent service.

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Dominic C

Excellent service, prompt and helpful

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Anonymous

I found Redman’s to be very efficient and got me the best deal available in the short time scale that was available.

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Very professional. Provided excellent advice on my Settlement agreement.

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Anonymous

Professional from start to finish.

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Oliver W

Excellent service provided by Redmans, will certainly consider using again.

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Melanie H

Very professional and extremely personable service. Thank you very much.

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Anonymous

I found Chris to be very approachable and easy to speak with about complex matters. He took action quickly and his updates to me, as his client, were prompt. I would recommend Chris and the team at Redmans without hesitation.

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Anonymous

Good advice

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Anonymous

Overall happy with the service provided by Chris and Rana.

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Anonymous

Chris and Rana provide a great service, very informed, diligent and care about your result, would recommend Redmans

Posted 4 weeks ago

David W

A speedy efficient friendly service, I would definitely recommend Redmans Solicitors for processing Settlement Agreements.

Posted 4 weeks ago

Anonymous

Both Rana and Chris were fantastic. From the first phone call I was confident my matter was in good hands. I was not disappointed. I would highly recommend Redmans. Thank you again for all of your support and advice.

Posted 1 month ago

Federico S

Great advices and communication. Through Redmana I obtained match more than what I thought. Highly recommended

Posted 1 month ago

Tom G

A good and efficient service with the required legal advice provided for a settlement agreement.

Posted 1 month ago

Francis T

The solicitor I used was Chris Hadrill, who I found extremely professional and I felt that he made me feel at ease, considering the subject matter he was assisting me with.

Posted 1 month ago

Anonymous

Chris provided excellent assistance with the negotiation of my settlement agreement. From start to finish, I was consitently updated and advised on the best course of action to take. I would highly recommend Chris and Redmans Solicitors.

Posted 1 month ago

Anonymous

They are busy people but manage well so generally I would recommend them.

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Anonymous

Very efficient and professional service from my first phone call making an enquiry. Timescales of the matter in hand were met and within the agreed budget. Would highly recommend Redmans

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Lisa B

Really very good service, always available to answer questions, provide my with any information I needed to make informed decisions.

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