Restraint of Trade

When an employer seeks to enforce a restraint of trade clause it vitally important that both parties understand the legal issues involved and experienced employment and workplace legal advice from an industrial relations lawyer or specialist industrial agent should be sought. I offer my services in relation to the complicated legal implications which arise and I can advise both small and large businesses in Perth and Regional Western Australia, and employees as well.

Recent decisions of the Australian courts* suggest to me that there is a trend towards upholding restraints of trade more readily than in the past. Whilst the courts remain reluctant to enforce restraints of trade with an injunction in the case of individual employees, preferring to follow the long line of equity and common law cases to the effect that contracts of personal service should generally not be enforced by specific performance injunctions, there have been some recent decisions to award damages against individual employees found to be in breach of such restraints. Curiously, those cases in my view emerge from facts where the breach was callous and high handed, something which I do not believe should be relevant to the question whether the restraint is valid or not. The validity of the restraint should be tested against what is reasonable or not; not whether the breach is crass, something which I would have thought should be remedied by quantum, not liability.

*For example Andrews Advertising Pty Ltd v Andrews (2014) NSWSC 318 delivered on 25 March 2014.

For further commentary about this, you may like to read by blogs on the subject, for there have been some very interesting recent developments. I attempt to update my employment law blog daily and 2015 has been a particularly busy year for case law developments about the law of redundancy. Furthermore I have recently been inundated with approaches from people who are being adversely affected by the downturn in the resources industry in Western Australia, especially the iron ore production and processing industry. Increasing too the oil and gas industries are being affected by economic turmoil on world financial markets. And of course, In Victoria particularly the motor vehicle production industry has been devastated by Toyota, Ford and Holden closing production facilities, or threatening to do so.