Corporate Express Ltd v Day, High Court (QBD), 17 December 2004
Day worked for Corporate Express Ltd (CE) as a sales manager. Her employment contract contained two restrictive covenants that applied after termination: a six-month ban on soliciting and/or dealing with customers, and a six-month ban on working for certain major competitors.
When she left the company and started work for a competitor, CE brought proceedings against her for breach of covenant.
The court granted a declaration that the covenant was reasonable and enforceable. During her employment with CE, Day had access to confidential information which would be useful to CE’s competitors.
The company, therefore, had a legitimate interest in protecting itself from the misuse of this information by way of restrictive covenants.
The non-solicitation covenant was not sufficient on its own to achieve the necessary level of protection.
Therefore, weighing up the potential financial implications for CE against the short-term financial hardship for Day, it was reasonable of CE to require Day not to work for a major competitor for a period of six months.
However, the court refused to grant an injunction preventing Day from continuing to work for the competitor because the restraint period was nearly at an end and the court accepted that Day would lose her new job if an injunction was granted.