Treasury’s Competition Review is inviting public submissions to its issues paper on non-compete and related clauses in employment contracts that limit what a worker can do, both during employment and when they stop working for a business including non-compete, non-solicitation and non-disclosure clauses.
Non-compete clauses are a type of restraint of trade clause that seek to restrict a worker (both employees and independent contractors) from working for a competitor or establishing a competing business, typically within a geographic area and for a time period after the worker ceases employment.
Non-solicitation and non-disclosure clauses can restrict what a worker can do with relationships built during employment, or how they can use confidential information learned on the job.
Businesses have other statutory and common law protections available to them to protect confidential information, including section 183 of the Corporations Act 2001 (Cth) (Corporations Act) which prohibits an employee from improperly using their position (including the company’s information gained through their position) for personal gain, third-party gain, or to cause detriment to the company. The Privacy Act 1988 (Cth) (Privacy Act) also protects certain personal information collected by certain businesses by restricting the use or disclosure of this information by former workers.
The Issues Paper also discusses the enforceability of restraint of trade clauses and wage-fixing agreements made between businesses.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
