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Restrictive Covenants - Government Consultation

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The Department for Business, Energy and Industrial Strategy has issued a consultation paper on measures to reform post-termination restrictive covenants.

It is considering two things.

First, altering the law so that post-termination restrictive covenants are only enforceable if the employer continues paying remuneration during the restricted period. For some time, I have routinely included a provision in restrictive covenants that if employers elect to enforce them, they will pay (say) two-thirds of normal remuneration as it makes them more attractive to a judge who is considering whether to grant injunctive relief.

Second, banning post-termination restrictive covenants completely (I cannot see this happening in a million years, and it is difficult to see that many large organisations would press for this in the response to the consultation).

My favourite typo in the consultation paper is the reference to 'non-complete' clauses on p15 (question 8).

The consultation closes on 26 February 2021.