Call for evidence on restrictive covenants
Close date: 19 July 2016
The Government has launched a call for evidence seeking views on restrictive covenants (termed "non-compete clauses" in the consultation) in employment contracts. They prevent former employees from working for a competitor, setting up a competing business, hiring workers from their former employer, or contacting former clients for a set period of time and/or in a specified geographical location. The Government is concerned that restrictive covenants may act as a barrier to individuals starting their own businesses or to workers moving freely between employers, and therefore hinder innovation and growth.
The Government invites views on:
- the use and prevalence of restrictive covenants in the UK, from both employer and worker perspectives;
- instances when restrictive covenants inhibited workers from changing employers or starting their own business;
- potential unintended consequences of government regulation of restrictive covenant use; and
- whether or not there is sufficient guidance on restrictive covenants in the public sphere.
This consultation is part of the Government's pledge to make Britain the best place to innovate and start a business in Europe.
Consultation document: Call for evidence on non-compete clauses