![]() ![]() No fixed geographical limits are set as to where the former employee had actual and significant client contact in order to protect the possibility of acquiring future business.The duration depends on the employee’s nature of work, seniority and skill level, the extent of influence and access to confidential information and the particular industry in question. Prevents the employees from using even their minimal expertise, which is not deemed vital to the operations of the organisation.Forbids the employee from working or being employed in the same industry. ![]() Prevents the employee entirely from working for a rival, regardless of the employee’s new scope of work with the new employer.Restrains competition illegally by applying the clause to all employees regardless of their nature of work, seniority, or accessibility to confidential information.Circumstances for the Non-Compete Clause to have “Unreasonable Scope”Ī non-compete clause is said to be unreasonable and hence, cannot be legally enforced if it is intended to have the following impact: However, the burden of proof to show that the scope is reasonable when seen from the perspective of public interest lies on the employee. For instance, in order to be reasonable in the public interest, the geographic restriction on the employee in certain markets cannot adversely affect competition in those markets. The Non-Compete clause should be reasonable both between the employer and the employee and for the interests of the general public. However, the advantage does not extend to any skill or know-how acquired by the terminated employee during the time of employment with the employer. Client and trade connections fall within the ambit of legitimate Proprietary interest. This type of ownership, termed as “Legitimate Proprietary interest”, is meant to protect the employer from an employee’s unfair practices. Legitimate Proprietary interestĪny asset or advantage that is regarded as the property of the employer solely belongs to the employer. The non-compete clause is generally invoked by the employer to safeguard the “Legitimate Proprietary interest” at the termination of employment provided the clause is within the “reasonable scope”. Circumstances for enforcing Non-Compete Clause Its main purpose is to exercise control over an employee’s actions, both during the employment period or/and after the employment contract is terminated. The clause prevents employees from seeking employment in another organisation or engaging in any kind of business in certain markets and geographical locations during a period of time. It is a clause that appears in the employment contract drawn between the employer and employee. ![]()
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