Effective restraints of trade protect businesses which rely heavily on human capital from damage that sometimes can’t be undone. These restraints – usually sitting in an employment contract – can be a key business asset.
Others might think about it as an insurance policy. The capacity to preserve customer connections, protect confidential information and discourage key executives from setting up their own business or moving to a competitor can be critical to information rich businesses operating in a competitive market. As we pointed out in our previous blog piece on post-employment protections The difference between winning and losing restraint litigation is often good housekeeping, ensuring the currency of your restraint provisions is an important exercise in risk management.