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NSW Can I Join Client's Company as a Contractor?

Discussion in 'Employment Law Forum' started by Sho$$10, 17 June 2016.

  1. Sho$$10

    Sho$$10 Member

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    Hi,

    I was an Indian employee for Company A and as part of my employment letter, I signed a clause that doesn't allow me to work with a client/competitor/supplier for a year. I travelled to the Client Location Company B on a work permit.

    My deputation letter only stated a restraint of trade that I should not seek employment with a Client. Currently, I am a Permanent Resident of Australia and resigned from Company A. I have received a good offer from my client Company B, as an individual contractor through an agency.

    Will I face legal charges if I join Company B?
     
  2. Victoria S

    Victoria S Well-Known Member

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    Where were you when you entered into the employment contract with company A? Is company A Australian? Is company B in Australia?
    Does the restraint of trade mention any geographical location that the restraint is confined to?

    If the restraint only prevents you from "seeking" employment with a client, then provided they sought out you and not the reverse then you may be able to get through it.

    If your ex employer Company A, tries to sue you for the restraint (or seek an injunction preventing you from working with Company B) they will have the obligation of proving that the restraint is reasonable. Generally any restriction on a person's freedom to engage in employment is illegal and unenforceable unless it is reasonable.

    A post employment restraint may be enforced where:
    • you have had access to confidential information that goes beyond mere know how, and where you are in a position to use that information to Compay A's detriment;
    • Your work involved personal contact with the employer's customers and where you may be able to use those connections to entice customers away; and
    • to protect key staff from being recruited or poached by former colleagues.
    Even Company A does have a legitimate interest to protect (which it appears it may), the restraint must be reasonable in its duration, geography and in the activities that it seeks to restrain.
     
  3. Sho$$10

    Sho$$10 Member

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    Hi Victoria,

    I was in India when I entered employment contract with company A.
    Company A is an India Company and has a head office here.
    Company B is Australian.

    My Deputation letter to Australia, only states that I shall not seek employment with my client.
    And I can prove that I was sought and did not seek.

    I was not and am not in any sort of Decision making/Executive Position. But I did work the client before, so I do have good relations with them.
     

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