Ottawa Non-Compete and Non-Solicitation Employment Lawyers
Many employers will attempt to limit the steps an employee can take following the end of the employment relationship through non-compete or non-solicitation clauses included in an employment contract. The employer’s aim is to protect its business interests, its customer base, as well as any confidential information, trade secrets or propriety methods of doing business from use or exploitation by their former employees. However, in many instances, these clauses are an overreach and therefore an invalid limitation on the employee’s personal freedom to earn a living.
Generally, non-compete and non-solicitation clauses are called “restrictive” covenants, because they aim to prevent or restrict behaviour rather than encourage it. An employee subject to such restrictive covenants at the end of an employment relationship may panic, faced with severe limitations on their future career prospects. In addition, the existence of these clauses in an employment agreement can make the employee feel trapped, and unable to move on to a new employer at their discretion. However, there are options available in both scenarios.
The employment law lawyers at Champ & Associates have been working with employees in a variety of employment scenarios for several years on matters involving restrictive covenants in an employment agreement. They are exceptionally experienced with the tactics employers use to restrict their employees, and how to effectively overcome them, including through pre-emptive litigation.
What is the Difference Between a Non-Compete and a Non-Solicitation Clause?
These terms are often heard together; however, they are very different in effect, and as a result, are treated differently with respect to their validity as well.
A non-compete, or non-competition clause, is intended to prevent an employee for a specified period of time from taking their services to a competitor of the former employer after leaving their previous role. This can have a chilling effect, particularly for workers with a specialized skill set who may only qualify for work with an industry competitor. For this reason, courts are reluctant to enforce non-compete clauses because they place unfair restrictions on freedom of movement for workers, which is contrary to the public interest.
A non-solicitation clause differs from a non-compete clause in that it is designed to prevent a former employee from soliciting business from or otherwise contacting clients of their previous employer. It is not as onerous as a non-compete clause, because under a non-solicit the former employee can still compete and provide services to clients of their previous employer, provided the employee did not directly solicit the business. In some cases, a non-solicit clause will prevent a former employee from trying to persuade a former colleague to join them at a new organization or business.
Determining the Validity of a Clause
To determine whether a non-compete or non-solicitation clause will be permitted to stand, the court will look at the following:
- Does the employer have a legitimate business interest worthy of protection?
- Is the proposed restraint reasonable as between the parties?
- Is the restraint reasonable with respect to the public interest?
- Are there exceptional circumstances at play?
These factors require a contextual review of the relevant facts of each individual case. This will include an examination of the essence of the business, the existence of any trade secrets or confidential information and the position of the former employee within the organization.
Other factors that may be considered include whether the terms impose time limits and geographical constraints on the limitations. For example, a clause stating that an employee cannot work for a competitor anywhere in Canada for three years or more is less likely to be enforced than one limiting the restriction to one year within Ottawa city limits.
For Experienced Representation for Non-Compete and Non-Solicitation Clauses in Ottawa, Contact Champ & Associates
Before signing an employment contract, it is important to have it thoroughly vetted by an experienced employment lawyer. Failure to do so could result in the imposition of onerous restrictions on one’s options for future employment. However, even if these terms are present in a contract, the employment lawyers at Champ & Associates are exceedingly experienced in overcoming them on behalf of their clients. They will enter into negotiations with your former employer or bring them to court in order to invalidate unfair and over-reaching covenants, in order to provide you with as many options as possible for your future. To discuss your matter in confidence, please contact the firm by telephone at 613-237-4740 or reach out online.
