Enforceability of Non-Compete Clauses

Written By:  Rodney Jackson

Posted: June 1, 2024 | 2 minute read

Non-compete clauses, which restrict employees from working with competitors post-employment, have been scrutinized for their reasonableness and enforceability.

• Case Example: Mason v. Chem-Trend Limited Partnership 

The Ontario Court of Appeal invalidated a non-compete clause that was deemed too broad and restrictive. The court emphasized that such clauses must be reasonable in terms of duration, geographic scope, and the nature of restricted activities.

• Employer Implications: Employers should ensure that non-compete clauses are reasonable and necessary to protect legitimate business interests. 

• Restrictive covenants should be drafted with care and should not be treated as boilerplate documents as they are scrutinized closely by courts and can often be hard to enforce.

• Employee Implications: Employees should seek legal advice if they believe a non-compete clause is overly restrictive on the grounds of geography, duration or activities.

Noteworthy

The recent common law changes to Ontario employment law underscore the dynamic nature of employment relationships and the importance of judicial interpretation in shaping workplace rights and obligations. For employers, staying informed about these changes is crucial to maintaining compliance, fostering a fair workplace and protecting the business from litigation. For employees, understanding these developments can help protect their rights and navigate their employment with greater confidence.

As the legal landscape continues to evolve, both employers and employees must stay vigilant and seek professional legal advice when necessary to ensure their actions align with the latest judicial rulings.

If you have any questions or matters you’d like to discuss with our team be sure to contact FullForce Legal Services to schedule a free consultation.

Disclaimer: The content of this article/blog are provided as a general introduction and overview of a legal topic only. This article/blog does not provide legal or other professional advice, nor does it express any opinion. It is recommended to consult a legal professional before making decisions based on your specific circumstances.

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