• Facebook
  • Twitter
  • LinkedIn
Call us now: 01243 836 840   [email protected]
Pure Employment Law
  • Who We Are
    • Nicola Brown
    • Peter Stevens
    • David Jones
    • Debbie Poole
    • Linda Nye
    • Brenda Cherry
  • For Employers
    • Advice on HR and People issues
    • Investigations, Hearings and Appeals
    • Restructuring and Redundancy
    • Defending Employment Tribunal Claims
    • Dismissal of Senior Executives
    • Contracts, Handbooks and Policies
    • Employment Law Training
  • For Employees
    • Settlement Agreements
    • Workplace Issues including Disciplinary and Grievance
    • Bringing an Employment Tribunal Claim
  • Employment Law Events
  • Legal Updates
  • Testimonials
  • Vacancies
  • Contact us
  • Search
  • Menu Menu

Restrictive covenants and drafting errors

27th April 2014

Restrictive covenants, which seek to impose restrictions on an employee’s activities after he leaves employment, are often a subject of litigation. They will normally only be enforceable in an employment situation where they are necessary to protect an employer’s legitimate interest and go no further than is reasonable in doing so. They will often seek to prevent employees approaching or dealing with customers, or working for competitors, usually within a defined geographic area. They are also invariably for a limited period of time.

As by their very nature, what is reasonable will depend on the role the employee did, the product or service the employer provided and so on, restrictive covenants should be drafted with care and tailored to the individual circumstances. If they are too wide, the courts will generally not enforce them. However, rather than always striking out entire restrictions where only a part of the covenant is too wide, the courts have adopted what is known as the “Blue Pencil Rule”. Under this rule, the courts have been willing to delete words where to do so would lead to the covenant being enforceable. So, for example, if a restriction purported to prevent a former employee from working for a competitor in West Sussex, East Sussex, Hampshire and Surrey, the Court may consider that to be too restrictive. If however by deleting Hampshire and Surrey the Court would have found the restriction to be enforceable, they can delete those areas – notionally by putting a line with a blue pencil through the offending words.

In the recent case of Prophet plc v Huggett [2014] Mr Huggett was subject to a restrictive covenant which prevented him from competing with, or working for a competitor of Prophet. An additional sentence in the contract qualified this restriction by defining what competition would mean, which was that it related to the provision of computer software systems for the fresh produce industry produced by Prophet. Mr Huggett left his employment with Prophet and moved to a competitor company. Prophet sought to enforce the covenant.

Mr Huggett argued that the restrictive covenant was irrelevant as the restriction was related to the provision of computer software systems for the fresh produce industry produced by Prophet. Clearly, on a literal reading of the restrictive covenant, it was meaningless and Prophet accepted that the competitor company would never provide software systems produced by them and therefore the covenant would not afford them protection.

The High Court rejected the employee’s assertion that the covenant should be construed to say what it said. Instead, the Court concluded that by adding three words to the covenant, that would reflect its true meaning, and the covenant should be read so as to read software systems produced by Prophet “or similar thereto”. The Court granted Prophet an injunction to enforce the covenant.

The case is unusual in that the Court felt that the drafting was an obvious error, and as such it had the right to interpret the wording to give it the meaning which it felt was clearly intended. This is a first instance decision, and although this particular decision may not be appealed, it will be interesting to see whether this case illustrates a way for the Courts to correct drafting errors and effectively avoid the Blue Pencil Rule which only allows for words to be deleted, not added.

It is of course best not to make drafting errors and have the argument. At Pure Employment Law we have considerable experience in drafting restrictive covenants, and therefore if you believe your business is worth protecting from the activities of former employees, it is worth getting in touch with us.

If you would like to talk through a situation you are dealing with, or if you need advice on any aspect of employment law, please contact any member of the Pure Employment Law team (01243 836840 or [email protected]).

Please note that this update is not intended to be exhaustive or be a substitute for legal advice. The application of the law in this area will often depend upon the specific facts and you are advised to seek specific advice on any given scenario.
Share this article
  • Share on Facebook
  • Share on Twitter
  • Share on WhatsApp
  • Share on LinkedIn
  • Share on Reddit
  • Share by Mail
https://www.pureemploymentlaw.co.uk/wp-content/uploads/2019/02/Pure-Employment-Law-logo.jpg 0 0 Nicola Brown https://www.pureemploymentlaw.co.uk/wp-content/uploads/2019/02/Pure-Employment-Law-logo.jpg Nicola Brown2014-04-27 17:05:492014-12-03 13:45:41Restrictive covenants and drafting errors

Join our mailing list

* = required field
Mailing Lists


Recent Legal Updates

  • Can long Covid be a disability? 29th June 2022
  • Employer unfairly counted disability-related absences when dismissing 29th June 2022
  • Did an Employment Tribunal correctly award an uplift for failure to follow the ACAS Code in a sham redundancy case? 29th June 2022
  • Without prejudice negotiations – what is unambiguous impropriety? 29th June 2022
  • Does referring to a man’s baldness at work amount to sexual harassment? 25th May 2022
Link to: Contact Us

Any questions? Why not get in touch!

Our advice is always given in plain English without any waffle, and we focus on providing practical solutions to our clients’ problems.

Contact us

LEGAL INFORMATION

Pure Employment Law | 1 Little London, Chichester, West Sussex, PO19 1PH
[email protected] | Tel: 01243 836840

Pure Employment Law is the trading name of Pure Employment Law Limited, registered in England and Wales with company number 07134294 and whose registered office is 1 Little London, Chichester, West Sussex, PO19 1PH. Pure Employment Law Limited is authorised and regulated by the Solicitors Regulation Authority with registration number 533794. A list of the company’s directors is available for inspection at the registered office

DISCLAIMER

The information contained in this website is for general information purposes only. The information is provided by Pure Employment Law and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.

Privacy Policy | Cookies Policy | Terms & Conditions | How to make a complaint | Sitemap

© Pure Employment Law 2022

Scroll to top

This site uses cookies. By continuing to browse the site, you are agreeing to our use of cookies as defined in our cookie policy.

Accept Cookie Policy

Cookie and Privacy Settings



How we use cookies

We may request cookies to be set on your device. We use cookies to let us know when you visit our websites, how you interact with us, to enrich your user experience, and to customize your relationship with our website.

Click on the different category headings to find out more. You can also change some of your preferences. Note that blocking some types of cookies may impact your experience on our websites and the services we are able to offer.

Essential Website Cookies

These cookies are strictly necessary to provide you with services available through our website and to use some of its features.

Because these cookies are strictly necessary to deliver the website, refusing them will have impact how our site functions. You always can block or delete cookies by changing your browser settings and force blocking all cookies on this website. But this will always prompt you to accept/refuse cookies when revisiting our site.

We fully respect if you want to refuse cookies but to avoid asking you again and again kindly allow us to store a cookie for that. You are free to opt out any time or opt in for other cookies to get a better experience. If you refuse cookies we will remove all set cookies in our domain.

We provide you with a list of stored cookies on your computer in our domain so you can check what we stored. Due to security reasons we are not able to show or modify cookies from other domains. You can check these in your browser security settings.

Google Analytics Cookies

These cookies collect information that is used either in aggregate form to help us understand how our website is being used or how effective our marketing campaigns are, or to help us customize our website and application for you in order to enhance your experience.

If you do not want that we track your visit to our site you can disable tracking in your browser here:

Other external services

We also use different external services like Google Webfonts, Google Maps, and external Video providers. Since these providers may collect personal data like your IP address we allow you to block them here. Please be aware that this might heavily reduce the functionality and appearance of our site. Changes will take effect once you reload the page.

Google Webfont Settings:

Google Map Settings:

Google reCaptcha Settings:

Vimeo and Youtube video embeds:

Other cookies

The following cookies are also needed - You can choose if you want to allow them:

Privacy Policy

You can read about our cookies and privacy settings in detail on our Privacy Policy Page.

Privacy Policy
Accept settingsHide notification only