Main menu


+44 (0)151 600 3000


+44 (0)161 836 8800


+44 (0)1772 823 921

Search form

Search form


Employment Bulletin

A regular bulletin that provides updates affecting employment issues and the related legislation and best practice.

To stay up to date with this bulletin and see others - sign up to any of our free newsletters.

Non-competition restrictive covenants: The importance of accurate drafting

Friday 31st October 2014

Share this article:

Employment Bulletin Issue 274

Background to restrictive covenants

Described as “the most powerful weapon in the employer’s armoury”, non-competition restrictive covenants have the potential to significantly restrict a former employee’s activities. Consequently, such covenants are void for being in restraint of trade and contrary to public policy, unless the employer can show that they have a legitimate interest to protect and the protection sought by the covenant is no more than is reasonable.

Traditionally, the courts will not enforce restrictive covenants which are drafted too widely. Similarly, covenants which are drafted too narrowly will not be construed as having a wider application than the wording, on the face of it, suggests.

Prophet plc v Huggett [2014]

Prophet plc was a software developer for the fresh produce industry. Mr Huggett was employed as its sales manager. His employment contract contained a non-competition restrictive covenant which prevented him from being employed “in any area and in connection with any products” with which he was involved whilst employed by Prophet plc.

The High Court held that the literal reading of the covenant provided Prophet plc with no protection at all. This was because no competitor would ever be selling Prophet products, which were the only products with which Mr Huggett would have been involved whilst employed by the company. However, the Court went on to infer that the true intention of Prophet plc at the time of entering into the covenant, was to extend the restrictive covenant to cover similar or competing products, not simply the specific products which Prophet developed.

The Court of Appeal unanimously allowed an appeal by Mr Huggett, refusing to extend the wording of the covenant to include “similar or competing products”. The Court of Appeal emphasised the importance of giving careful thought to the underlying intention of a party when drafting a non-competition restrictive covenant.

Following the Court of Appeal’s decision, Mr Huggett was free to work for a new employer, selling products that competed directly with Prophet’s products.

Lessons learnt

The Prophet case shows that you cannot rely on the courts to infer what you meant by ambiguous drafting in restrictive covenants. Drafting errors will not easily be rectified by the courts.

It is therefore imperative that serious thought is given to the true intentions of your business when drafting a restrictive covenant and that the appropriate wording is chosen accordingly. This is particularly important for businesses who sell a unique product or service and who wish any non-competition restrictive covenants to extend to similar or competing products or services, not simply the ones which they themselves provide.

How Brabners can help

Brabners can help you review and draft employees’ restrictive covenants to ensure that they clearly reflect your business’s intentions and are not open to misinterpretation by the courts.

For further assistance please contact:

Rachael Kirkup
Rachael Kirkup

Solicitor, Employment & Pensions
Tel: 0161 836 8860

Shared Parental Leave and pay - Who’s holding the baby?

Friday 17th October 2014

Share this article:

Employment Bulletin Issue 273

A new system of statutory parental rights will apply for eligible parents where a baby is due to be born on or after 5 April 2015. The new right will allow eligible parents to share the statutory maternity leave and pay that is currently available only to mothers (and a primary adopter).

The current legal framework

Statutory parental rights are currently made up of maternity rights, paternity rights, adoption rights and unpaid parental leave.

In respect of maternity rights, all UK employers must comply with the statutory minimum entitlements applicable to pregnant employees and those taking and returning from maternity leave:-

  • Time off for antenatal appointments.
  • Health and safety protection while pregnant and breastfeeding.
  • Up to 52 weeks’ maternity leave (made up of compulsory maternity leave, ordinary maternity leave (OML) and additional maternity leave (AML)) regardless of length of service.
  • Statutory maternity pay (SMP) for up to 39 weeks.
  • The right to return to the same job.
  • Priority for alternative employment in redundancy cases.
  • The right to request flexible working conditions on return to work.
  • Protection from dismissal, detriment or discrimination by reason of pregnancy or maternity.
  • The right to the benefit of all of the terms and conditions of employment (except remuneration) including any non-contractual benefits that are connected with employment, which would have applied had she not been absent.

Employers are always free to agree more favourable contractual terms relating to maternity pay with their employees, however it is not possible for an employee to agree to less favourable terms than the statutory regime provides.

New system of statutory parental rights

The regulations are currently before parliament and are due to come into force on 1 December 2014. Some of the key provisions anticipated in the regulations include:-

  • Eligible employees will continue to be entitled to a maximum of 52 weeks’ maternity leave and 39 weeks’ statutory maternity pay or maternity allowance. All of this leave and pay (apart from the first two weeks’ compulsory maternity leave) will be available for sharing. The mother can decide to end her leave early and share the remaining leave with her partner or the couple can decide to take their leave concurrently, as long as the total time taken does not exceed what is jointly available to them.
  • Leave can be taken in a single period or in non-consecutive periods. Employees should discuss their intentions early on with their respective employers.
  • Employers could refuse a discontinuous leave notification and require that the employee takes leave in a single period.
  • Ordinary paternity leave and pay will still be available to be taken within 56 days of the birth.
  • Eligible adopters will also be able to benefit from the new system. Adoption leave and pay will also be extended to prospective parents, and eligible parents in a surrogacy situation.

ACAS has prepared a good practice guide for employers and employees which is available to download. The guidance is written to help eligible parents decide whether the benefits of shared parental leave will work for them and how it could be used alongside, or instead of, traditional maternity or adoption leave. It is also written to provide employers with an understanding of their legal obligations and good practice procedures to use in their workplace.


The new right is designed to allow parents greater flexibility in how best to balance their work and childcare responsibilities. Where parents do choose to customise their own leave, this will present organisational problems for employers. Finding maternity cover will be particularly challenging where the leave period is broken up into many different blocks, and calculating how much statutory parental pay or normal salary due will not be straight forward in this situation.

Employers could start to receive notice of the intention to take shared parental leave from eligible employees from January 2015. Employers will therefore need to have updated policies in place reflecting these new entitlements. Forward thinking employers are preparing this documentation now.

Watch This Space

Brabners are preparing a guidance/document pack on shared parental leave which will be launched to coincide with the new regulations coming into force.

In the meantime, if you would like to be contacted to discuss the changes required to your Staff Handbook, or for any other employment law advice, please do not hesitate to contact either:

Elspeth Beatty
Solicitor, Employment & Pensions
Tel: 0151 600 3114


Rachael Kirkup
Rachael Kirkup

Solicitor, Employment & Pensions
Tel: 0161 836 8860

Employee held to notice period following resignation in repudiatory breach

Thursday 25th September 2014

Share this article:

Employment Bulletin Issue 272

Employers do not have to accept a ‘walk out’ by an employee as terminating the contractual relationship and the contract may subsist despite non-payment of salary during the notice period.

In the recent High Court case Sunrise Brokers LLP v Rodgers the High Court made a declaration that an employee who had purported to resign with immediate effect, in repudiatory breach of contract, was still employed as his employer had not accepted the breach. An injunction was granted, requiring him to observe the terms of his employment contract until an agreed date. The employee, who had not returned to work following his purported resignation, was not entitled to be paid during this time as he was not ready and willing to work.

The case concerned the broker Michael Rodgers who was subject to a fixed term contract to 22 September 2014 then 12 months’ notice. There was a garden leave provision which entitled his employer Sunrise Brokers LLP (“Sunrise”) to place Mr Rodgers on garden leave, provided he continued to receive salary and benefits from Sunrise.

Having accepted an offer of employment with a competitor at the start of March 2014, Mr Rodgers walked out of his employment on 27 March 2014. Sunrise refused to accept Mr Rodgers repudiatory breaches of contract in purporting to terminate the contract without notice and elected to keep the contract alive.

Sunrise agreed to permit Mr Rodgers 6 months’ notice to expire on 16 October 2014, at which point it contended that Mr Rodgers became subject to covenants of 6 months’ duration. Sunrise also contended that it did not have to pay Mr Rodgers when he failed and/or refused to attend work.

Deputy High Court Judge Richard Salter QC upheld Sunrise’s claims for a declaration and injunctive relief. The employment contract was still in existence and would come to an end on 16 October 2014.

The Judge rejected Mr Rodgers’ argument that Sunrise had to pay him during the period of notice, even though it wanted him to come to work and had not placed Mr Rodgers on garden leave. Mr Rodgers’ right to payment of salary was dependent on his readiness and willingness to work.

Practical Tips

An employer may choose not to place an employee on garden leave during the notice period and the employee cannot force the employer to put him on garden leave. If the employee fails or refuses to attend work during the notice period he or she may not be entitled to be paid and it is useful to include an express clause in the employment contract to this effect.

Tactics are of utmost importance when considering resignations which may be in breach of contract and such resignations should not be responded to without careful consideration where there is a continuing interest to protect.

If you would like more information regarding termination of the employment relationship and/or garden leave, or help with any other employment law matter please contact: 

Brendan McAleese
Solicitor, Employment & Pensions
Tel: 0151 600 3067
Email Brendan

Stop Press: Labour's likely Employment Law Policies outlined at TUC Event

Monday 15th September 2014

Share this article:

Employment Bulletin - Stop Press Issue 271

Chuka Umunna MP, Shadow Secretary of State for Business, Innovation and Skills, has delivered a speech to the TUC Congress outlining major reforms to employment law that would be made should the Labour Party be elected in 2015.

Amongst the policies mentioned at the TUC event on 8 September were:

  • A likely review of the “prohibitive” Employment Tribunal fees regime that has recently been introduced by the current government – “Affordability should not be a barrier to workplace justice”. Commentary from the Financial Times has suggested this will likely be a change to the means testing for fees, rather than a total abolition of the fee system.
  • Reform of the current Employment Tribunal system.
  • A commitment to “restoring the value of the national minimum wage”.
  • The intention to “outlaw” zero hours contracts.
  • Removal of the “Swedish derogation” from the Agency Workers Regulations 2010, which provides an option that agency workers with a permanent employment contract with an employment business are exempt from equal treatment in relation to basic working and employment conditions (e.g. pay).

A transcript of the full speech is available here.

If you would like more information about these changes or for help with any other Employment Law matter, please contact:

Joe Aiston
Solicitor, Employment & Pensions
Tel: 0161 836 8955
Email Joe

An employer that has outsourced its appeal process to an independent panel, will not always be bound to implement the panel’s decision

Monday 8th September 2014

Share this article:

Employment Bulletin Issue 270

An employer that has outsourced its appeal process to an independent panel, will not always be bound to implement the panel’s decision.

In the recent EAT case of Kisoka v Ratnpinyotip (t/a Rydevale Day Nursery), the Employment Tribunal’s decision that the decision to dismiss was fair given that the Employment Rights Act 1996 requires tribunals to consider all the circumstances.

The case concerned an employee who was dismissed for gross misconduct based on the employer’s belief that she had started a fire at the children’s nursery.

The employee appealed the decision to dismiss her and the employer, for reasons relating to its size and consequent lack of managers, arranged for an independent panel to carry out the appeal. The panel overturned the employer’s decision to dismiss mainly because it felt that there was insufficient evidence to implicate the employee as having started the fire. The employer was not happy with the panel’s decision and decided not to implement it.

The Employment Tribunal found that the employer had given proper consideration to the appeal panel’s views but felt that they could not be adopted.

Upon appeal, the EAT held that the Employment Tribunal had been correct to take into account all of the circumstances, including:

  • The employer was a small organisation and there was nobody at the appropriate level, and who had not made the decision to dismiss, to hear the appeal.
  • There were no clear terms of engagement with the panel that it would be the panel who made the final decision.
  • Further information was provided by the employee at the appeal stage which the employer subsequently investigated.
  • The employer is responsible for the welfare of the children.

The judge was entitled to take the view that overall the procedure was not unfair, and the decision of the employer was not unreasonable.

Practical Tips

Employers should tread carefully when considering the appointment of an independent panel to carry out an appeal process. Where the organisation’s resources allow for the process to be carried out in-house then this should be the preferred option.

If an independent panel is to be appointed, then an employer should carefully review the terms of engagement between the employer and the panel and reserve the right to make the ultimate decision.

If you would like more information regarding disciplinary procedures and your obligations as an employer or for help with any other employment law matter, please contact:

Brendan McAleese
Solicitor, Employment & Pensions
Tel: 0151 600 3067
Email Brendan

Bulletin 269 - An employee's breach of contract will not always justify dismissal without notice - July 2014

Download pdf

Bulletin 268 - Are you thinking laterally about growth? July 2014

Download pdf

Bulletin 267 - Should commission be included in statutory holiday pay? June 2014

Download pdf

Bulletin 266 - Stop Press - World Cup 2014 - Are employers ready for kick-off? June 2014

Download pdf

Bulletin 265 - Caste Discrimination - A Protected characteristic - May 2014

Download pdf