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ACT No-solicitation Restraint of Trade Clause Valid under Employment Law?

Discussion in 'Employment Law Forum' started by Pioneer, 2 April 2015.

  1. Pioneer

    Pioneer Active Member

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    Hello, I work with an agency as a freelancing tutor. When I started using the agency's service, I had to sign a "Policies and Procedures document, in which a term states that I agree to "not contact any Clients of the Agency for a period of 2 years if the Tutor no longer wishes to use the services of the Agency"

    • Is a "Policies and Procedures" document considered as legal employment contract?
    • Does the restraint include me responding to clients' contact (in a professional setting)?
    • Is it enforceable in the ACT?
    • Is a two-year period considered reasonable in the ACT employment law?
    • What would happen if a client approached me requesting my service and I agreed?
     
  2. Rod

    Rod Well-Known Member

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    Yes, you signed it.
    Generally no, may depend on exact wording and other clauses.
    Yes
    Uncertain. Depends on other factors around the circumstances of your engagement. As a general principle, a court will not stop you earning a living unless your contract is very generous.
    Probably nothing as you did not solicit the client. Check other clauses.
     
  3. Rod

    Rod Well-Known Member

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    BTW, you may be considered to be an independent contractor and as such not covered by employment law but covered by contract law. Depends on your agreement.
     
  4. Pioneer

    Pioneer Active Member

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    Hi Rod,

    Thanks for the reply.

    Indeed, yes. I'm defined in the agreement as a "sub-contractor providing a service on behalf of the Agency". It also states that "This is not a partnership or employer/employee relationship between the parties to this agreement and the Tutor is not entitled to any employee entitlements. No superannuation is offered by the Agency, and the Agency is not responsible for the tutor’s taxes."

    Does that change any of your answers?

    A follow up question on your answer: Given the above, and considering the worst case scenario, and keeping in mind that this is a low-income job, what would a court say if I respond to a client's request for service?

    Thanks again, and enjoy the Easter break.

    Regards.
     
  5. Pioneer

    Pioneer Active Member

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    I mean, would the court require compensation, force termination of my service to the client,...etc.
     
  6. Rod

    Rod Well-Known Member

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    No, doesn't change my answers.

    Unlikely as long as you do not solicit clients. Generally you would have to have done something unconscionable before the court ruled against you. Then again, you could catch a Magistrate having a bad day :)
     
  7. hlly

    hlly Well-Known Member

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    These sorts of clauses are notorious for being incapable of having their enforceability accurately adjudicated without litigation. In other words, it could go either way. Basically, the law allows the agency to set reasonable limits in restraint of your future trade. This clause will be partially effective, and maybe enforceable for the whole two years.
     

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