Part two: Bruce Gardiner & Ming Yee Shiu continue their guide to enforcing or resisting covenants
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In the first part of this article we addressed the first four points of a 10 point checklist for giving clients initial advice in a restrictive covenant situation (see NLJ, 29 May 2009, p 768). We discussed the circumstances in which restrictive covenants are enforceable. But what if there are no restrictive covenants, or the covenants appear to be unenforceable? And what practical issues arise when seeking an interim injunction?
Can employers rely on any implied terms or IP rights?
In the absence of valid post-termination restrictive covenants, it is worth considering possible pre-termination breaches of other contractual terms, particularly implied terms. All employees are under implied duties of fidelity, encompassing several separate strands, including duties of honesty, good faith and a duty to preserve confidences. During employment, an employee cannot compete with his employer or work for a rival. However, he is not restricted from taking preliminary steps
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