Expert, Affordable, Employment Advice

Are non-compete clauses stifling entrepreneurship?

The Government wants to know whether non compete clauses stifle entrepreneurship by preventing workers from starting up their own business after leaving a job.

There are clearly arguments for and against the use of non-compete clauses. Employees think it unfair that having left an employer, they may be prevented from working for a competitor for a period of time, meaning that sometimes they face the prospect of unpaid leave.

Employers are naturally concerned that, having invested in an employee, they then swan off to a rival with the benefit of the employer’s training, contacts etc.

In most employer/employee relationships there is often a massive imbalance in power, meaning the employer can pretty much impose whatever terms they like. The costs of challenging a non compete clause can be eye watering and certainly not something the average employee would want to take on.

It is difficult to see how this area could be effectively regulated, but the government is nevertheless making a call for evidence. If you fancy expressing an opinion then the link is here.

Sarah Rushton (This email address is being protected from spambots. You need JavaScript enabled to view it.)

Partner

This is intended for general information only and should not be considered as giving advice in relation to any individual case nor be taken as applying to any particular case. No liability is accepted for any such use of the information contained.