|
Wednesday 23rd March 2016
|
|
How to stop an ex-employee from soliciting your business
|
In today's Workplace Bulletin:
- Hey, quit stealing my (your old) clients!
|
| If you have reason to believe an employee might resign and ‘poach’ your clients, what can you do legally to stop it from happening?
Contractual clauses that seek to restrict an employee earning a livelihood after they leave your employment are prima facie unenforceable. You have to show the restraint provides reasonable protection for a recognised business interest (yours) in order to enforce a post-employment contractual restraint. |
You can impose a non-solicitation restraint upon a former employee to protect customer relationships, provided its period of operation is reasonable. A reasonable period is the time needed to introduce a replacement employee to those clients so they can re-establish a connection with your business and thereby protect your goodwill.
An example of a non-solicitation restraint:
“Upon termination of the employee’s employment for any reason whatsoever, he will not, without the written consent of the employer, solicit any of the employer’s clients that he had dealings with during his employment.”
In Entello Pty Ltd v Firooztash (11 March 2016), a financial planning and investment advisory business obtained a Court order to enforce a six-month non-solicitation restraint against an advisor after he left the firm. |
| | |
|
Want access to over 50 sample employment law contracts, policies, letters and forms you can copy and start using in your workplace?
Click here to learn more
| |
| | |
|
The Court ruled that ‘solicit’ means ‘to ask for business’. An employee can solicit your clients even if they do not telephone, email or arrange to meet them to discuss business.
For example, there is solicitation of a client by a former employee if the former employee in substance conveys the message: “I am ready and willing to deal with you and encourage you to do so.”
If one of your clients asks your ex-employee what has to be done to get him to act for them, and your ex-employee replies that they would need to give him a letter of appointment to his new employer, that would be solicitation.
Regards,
Charles PowerEditor–in–Chief Employment Law Practical Handbook
Would you know what to do if one of your employees who deals directly with your customers resigned tomorrow? Would you know how to stop them from ‘poaching’ your clients that you’ve worked so hard to garner in the first place?
If your employee resigns, how much notice do they need to give? Can you ask them to run down their leave entitlements? Can you place them on ‘gardening leave’?
What if they don’t want to serve out their notice period or refuse to carry out their obligations?
Sounds like you might need some help.
The Portner Press Employment Law Handbook, written by the workplace law experts at Holding Redlich, has all the information you need to ensure that resignations are lawful and that your business’s interests are protected.
Get your copy now because you never know what’s just around the corner.
Do you have a colleague or friend you think will benefit from today’s Workplace Bulletin?
Knowledge is one of the biggest assets in any business. So why not forward this on to your friends and colleagues so they too can start taking advantage of these employment law tips?
|
|
|
Check out our other free bulletins
|
|
Please whitelist the Workplace Bulletin to make sure you get every edition delivered to your inbox.
The information in this email is intended solely for the addressee. Access to this email by anyone else is unauthorised. If you are not the intended recipient, please return the message to the sender and delete it from your records. All content is ©2007-2016 Portner Press Pty Ltd All Rights Reserved.
Disclaimer: We research our recommendations and articles thoroughly, but disclaim all liability for any inaccuracies or omissions found in our publications. Click here to view our Privacy Policy and Terms and Conditions.
Workplace Bulletin ISSN 1836-117X
Portner Press Pty Ltd 96-98 Bridport Street Albert Park VIC 3206 Australia
|
|