Call for evidence on non-compete clauses launched

Following on from its earlier announcement, the Government has now launched its call for evidence on non-compete clauses.

The Government is exploring whether non-compete clauses unfairly hinder workers from moving freely between employers, and from developing innovative ideas, translating those ideas into a start-up, and growing their business. It recognises that there are situations in which non-compete clauses are valid and serve a useful purpose but it is looking at whether there are reasons for believing that they are stifling innovation, particularly for start-up businesses.

The call for evidence covers not only clauses which prevent employees from setting up or working for a competing business, but also clauses which prevent employees from dealing with their former employer’s customers and clients or from hiring its workers.

The Government is seeking evidence on:

1. The prevalence of non-compete clauses, including whether they are used particularly in certain sectors and if so which?

2. Whether you as an employer have used a non-compete clause and, if so: 

• What job did it cover?
• What were the terms of the restriction?
• Do you use them only for certain jobs or as a blanket terms across the business?
• Whether you have sought to enforce them and, of so, what action you took and the outcome?