What Are Restrictive Covenants?

You may be reading through your contract and come across a term, restrictive covenants. But what does this mean? Well, its a type of clause in your contract that forbids you from working with a competitor, after you have left your job.

Sometimes people find this clause unacceptable or hindering to someone's career - especially if a rival business is trying to poach you. However, restrictive covenants usually have a time period, then they expire, or they have geographical limitations. Meaning, you could work for a competitor as long as it is some distance away from your old workplace. Restrictive Covenants vary, but you may see terms like this in your contract.

  • Non-Solicitation Clause. Designed to make sure you keep your little black book of contacts closed and stops you from contacting old clients.

  • Non-Dealing Clause. You cannot make deals or sales with previous clients.

  • Non-Poaching Clause. In your new job, you can’t ask your previous work colleagues to come and work in your new workplace.

Not all jobs have these clauses, so you should check your contract carefully and see what the terms and conditions are in your workplace.

What is a Non-Compete Clause?

The most common type of restrictive covenant is the non-compete clause. Probably the most infamous employment law, this clause even reached the headlines. Channel 4 bought one of the nations favourite TV shows, the Great British Bake Off. The beloved Mary Berry couldn't move on over to Channel 4 because of her employment contract, and the non-compete clause she has with the BBC. The UK government has been looking deeper into the non-compete clause, to see if employers are abusing the system and whether restrictive covenants should be banned altogether.

But what exactly is this non-compete clause? This restriction is to prevent you from working for a competitor in a similar role you may have had in your previous job. It is supposed to make sure that you don't take valuable information to another competing business. But this clause goes further than that; it is also to stop you from creating a company that will compete with the one you just left. However, this clause expires typically after some time, such as 12 months.

If you break any of these restrictive covenants, you’re breaking the law and your previous employer may take you to court. However, if the High Court finds that the restrictive covenants are unreasonable, they can't be enforced.

What is Gardening Leave?

Probably the nicest restrictive covenant, gardening leave or garden leave (no, not guardian leave!) is when your employer doesn't see the need for you to stay in the workplace, once you handed in your resignation. You will be sent home straight away and won't be expected to work. You will still get full pay and all your workers rights. Because of this, to some people, this is a dream scenario. Typically, gardening leave lasts for three months.

Gardening leave has its origins from the 1980s. Yes, you can blame millennials for this term. The dictionary describes the phrase gardening leave as a euphemism, meaning, "suspension from work on full pay." Although no one knows where the phrase gardening leave comes from, it is, however, accepted as a sarcastic term to mean you now have time to do the gardening.

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