Non-solicitation clause query

[Bunk]

Cheers guys. I actually misread (or mis-remembered) the clause as being the the usual restrictive covenant. It was only today when I went back and re-read it that I realised it didn't prevent me working for clientco's client. As I said, it's not a recruitment agency contract which is probably why it doesn't have it.

[DirtyDog]

Now, as I understand that, it means I agree not to poach any of clientco's staff or persuade them to leave for a period of 12 months, and that during the term of the schedule (ie the duration of the contract) I agree to inform them of any conflict of interest or competitor I may also be doing any work for.

So where does that leave me with working for one of their clients? I can't see anything there which prevents me taking a contract with their client after this contract has ended. It might be worth pointing out this was a direct gig so this is clientco's contract, not a recruitment agency contract.

Any thoughts?

Thanks

I agree with you - the clause stops you poaching their staff for a period of 12 months, and not competing with them while working with this client. There is nothing in those clauses which deals with working with their clients once you aren't working with them.

Which is exactly the thing that you should expect - if you were a big consultancy, there wouldn't be any restriction, so why should there be for a small business?

Nothing to worry about, fill your boots. If anyone from the new client asks anything, you can show them the contract which clearly does not prohibit you working with them.

[northernladuk]

Handcuffs like this are only valid if the old client can prove loss through business or intellectual property i.e. you were developing something the old client might sell to the new client and the new client takes you on to gain that information.

If the work you will do for the new client is totally unrelated to the work you did at the old client then it just will not stand up in court if there is no loss to the old client. They can't stop you working for another client for no reason whatsoever.

I also believe the 12 months isn't valid either. I think there is some right to work that means anything over 6 months just isn't fair.

I think the only thing to worry about (assuming the work is unrelated) is someone getting touchy at the old client and complains to the new client who drops you like a stone because they don't want avoid any legal issues. This is more common when dealing with agents. I have been in a situation where two agents were arguing and the client just dropped me to avoid the hassle. I think clients will be a lot more relaxed than agents will due to the cut throat element of agency work.

If the clients are big enough and the work is totally unrelated then I don't think you have a problem.

[Bunk]

I may have the option to do some work for a previous client's client in the future so, obviously, I dug out the contract to check what the restrictive period was for working for their clients. The non-solicitation clause is as follows:

(a) During the term of this Agreement, and for a period of twelve (12) months thereafter, the Consultant agrees not and to procure that the Personnel agree not to solicit or induce any employee of the Company, -------- or any of ----------’s subsidiaries, to terminate his or her employment with the Company or any Group Company (including, without limitation, --------- or any of ---------’s subsidiaries), and not to hire any employee of the Company or any Group Company (including without limitation, -------- or any of ---------’s subsidiaries), without the prior written approval of the Company.

(b) Nothing in this Agreement shall prevent the Consultant or the Personnel from being engaged, concerned or having any financial interest in any other business, trade, profession or occupation during the term of the relevant schedule A provided that:

(i) such activity does not cause a breach of any of the Consultant’s and/or the Personnel’s obligations under this Agreement; and

(ii) the Consultant shall not and shall procure that the Personnel shall not, without the Company’s prior written consent, engage in any activity that would place Consultant in a conflict of interest with the Company, and shall immediately disclose in writing to the Company the identity of any competitor of ---------- for which Consultant and/or the Personnel agree to do any work, whether as an independent contractor or otherwise or agrees that its employees, independent contractors or agents do any work.

Now, as I understand that, it means I agree not to poach any of clientco's staff or persuade them to leave for a period of 12 months, and that during the term of the schedule (ie the duration of the contract) I agree to inform them of any conflict of interest or competitor I may also be doing any work for.

So where does that leave me with working for one of their clients? I can't see anything there which prevents me taking a contract with their client after this contract has ended. It might be worth pointing out this was a direct gig so this is clientco's contract, not a recruitment agency contract.

Any thoughts?

Thanks