What is a restrictive covenant?

A restrictive covenant is an agreement (usually a clause within a contract) between an employer and an employee that restrains the employee from carrying out certain actions both during employment and in the event that the employment ceases. Restrictive covenants are primarily concerned with protecting the employer's interests when the employment has ceased, as employees are under a duty of fidelity and cooperation, which protects employers during employment. The actions that covenants commonly seek to prevent a former employee from carrying out include: competing with the employer, taking the employer's trade secrets and soliciting the employer's clients and/or staff.