Non-Compete clauses to be restricted…

Non-compete clauses in employment contracts will be subject to a statutory limit of three months under new Government plans. The intention is to apply a limit to those employment contracts of workers engaged under a contract of service, rather than to long term employees. The Government has made it clear that they are not restricting an employer’s ability to use paid notice periods and garden leave, so businesses who are concerned about the three-month limit on non-competes could potentially use longer notice periods and garden leave (which are both more difficult for employees to challenge in court) to get around the new restrictions.

The three-month limit is a response to the Government’s consultation, launched in December 2020 as part of efforts to boost innovation, create the conditions for new jobs and increase competition for the economy as it recovers from the impact of Covid-19.

There is no set time for this changing but the government have promised that legislation will be brought forward when time permits.

If you are concerned over your contractual terms for non-competition, contact 121 HR Solutions for assistance on 0800 9995 121.