Q&A - Can I get restrictive covenants removed from redundancy agreement?

Q:  I am awaiting details of a redundancy package which I am expecting will contain the same restrictions as those in my contract of employment, in respect of client confidentiality and work I may do elsewhere with another company. So that I am armed with information in the event that my assumptions are correct, is there any way that I could get such covenants removed? After all, I have no choice about leaving the company and I need to get another job to support myself and my family.

A:  As a rule of thumb a restrictive covenant will only be enforceable if it protects the employer's legitimate business interests, and only if it applies for a specific and reasonable time period (usually six months maximum, unless very senior staff). In practice this usually means that you cannot go after any of your employer's clients or use your knowledge of your employer's products or practices to damage their business. Your employer cannot, however, restrict your ability to work at all.

As soon as you receive the terms of the redundancy package you should seek proper legal advice from a solicitor who has experience in employment matters - because whilst restrictive covenants are sometimes unenforceable, being sued is a costly way of finding out.

Most employers should expect you to try and negotiate better terms for your redundancy. It may be that your employer is more concerned about protecting its trade secrets rather than stopping you competing - there could be scope for negotiation.

When it comes to getting released from covenants, a better result is likely to be achieved by a solicitor. Similarly, a solicitor may be able to achieve a better package offer. Whatever happens though, you should keep a record - off the company premises - of all discussions that takes place.


Robert Williams

Robert Williams

Partner and Complaints Handler

Partner and Head of the Civil Litigation, Personal Injury and Dispute Resolution team in Wrexham