It is to be critically evaluated the issues arising out of Sandra’s(S) consideration to Leave Bright Plc (B) and seeks employment under The Max Ltd (M). Areas for evaluation are implied terms and duties. In addition, a critical exploration of the section of laws that encapsulates both restrictive covenants and confidentiality.

This analysis of the facts points to the area in law known simply as implied terms, these terms when applied places upon those parties under a contract of employment a duty to obey [1] although never expressed these terms, however the courts would have to recognise the purpose of the term, the classic test was set forth in Moorcock (1889) [2] in this case it was for the purpose of providing “Business Efficacy” and the what of parties would have intended, and furthermore, these were “so obvious that the parties would have intended to have include them” as stated by MacKinnon LJ Shirlaw v Southern Foundries Ltd [1939] 2KB 206 CA in , he further state the belief that not all terms need to be expressed and introduced the idea of the “Officious Bystander”(the objective test) and that these terms were “something so obvious that it goes without saying” ., however the Courts a reluctant to uphold these terms, unless these terms have come about through Custom and practice [3] (C&P) .

In this instance the facts suggest that certain implied terms could be imposed upon S, any court upon examination could find that S was under such duties, these being, fidelity [4] which imply a person’s loyalties and faithfulness [5] , and those of fiduciary which refer to implied duties of trust and confidence which if established by the courts.

In upholding terms of fidelity the courts would automatically infringe on and conflict with a person’s rights to choose their career path.

However the implied duty of fiduciary is a more notable obligation and thus S and B would owe one another a duty not to act in a manner that is possibly going to seriously damage or worse, destroy the confidence and trust, vital to the relationship between S and B. Their relationship is often referred to as ‘the term of “mutual trust and confidence”. The term itself refers to the implied element which the law recognises as one of the component of all contracts of employment.

The extent of activities that may cause a “breach of term” are wide. Exploring this further, the elements that may cause a breach could be for example an employee allowing sexually harassed, serious verbal abuse, seriously and the undermining the power of an executive. Furthermore, the imposing of penalties without proper procedural rulings for the purposes of disciplinary actions has been held to be breaches of the terms. The term may be breached by an omission as well as a positive action, this maybe best demonstrated by customs and practice, where an employer isolates an employee by issuing bonuses to all but one of the employees.

A fundamental breach of a contract may occur when the implied term between the parties for trust and confidence [6] which is central to the breach and that may have led to resignation or threat of being constructively dismissed.

A duty of confidence and trust [7] is owed to B while S is engaged in work, which maybe the case after her leaving (examine later), dependent upon position, in case of S that of senior management and the exposure to sensitive material. Furthermore, while employed, confidential information must not divulge to a competitor ( M) that would be harmful or damaging once disclosed, however, information gained and that has retained to memory shall not be construed as a breach of implied terms [8] .

In addition, none of the document shall be removed from the B’s premises upon leaving, in today high tech world this would include e-documents and mail, furthermore this may have been included into the junior contract by way of expressed terms, identified as a restrictive covenants, which S would have agreed and sign before her engagement of employment for B could start work. Such restrictive covenants would require that information S gained whilst under employment for B, to be kept confidential.

Moreover, such restriction would prevent S from establishing a business in direct competition with B, furthermore, the S would not be able to recruit colleagues from B to work for the rival company (M), however, any attempt by B in deny S the right to make a living in, by working within the mobile phone and broad band industry would be taken extremely serious by the courts. Therefore a careful drafting of the covenants, not to place a blanket ban on joining all other employers who work within the same industry, would not be enforceable by the court.

In addition a restrictive covenant could prevent S from working in the same industry within 10-20 miles of B’s outlet, this localised prohibition would be deemed plausibly enforceable rather than a covenant which prohibits regional or even nationally restrictions.

In relation to the proposed new call plans and broadband packages, the courts would have to exam whether B information is so exclusive that it could be specified as being trade secrets [9] , and therefore it must be kept confidential even after S left. Restrictive covenants in the protection of confidential information which may survive the termination of S and her “contract of services”, even if B was to breach S’s employment contract.

Often Employers include restrictive covenants into their contract of employment in order to restrict information that was gained within the normal course of employment and that may be beneficial to another employer once communicated, which is likely to be harmful or damaging to the B, and by signing such restrictive covenants places a duty to keep information secret until that information becomes public knowledge at which point the information shall be classed as not harmful.

However, B cannot prevent S from using the “skills and knowledge” she had obtained, even if S had acquired those skills and knowledge whilst employed for B, for example, if S had been employed as a panel-beater and had learnt a new method of removing dents from a damaged vehicle, then the knowledge becomes part of S’s “skill and knowledge”, therefore allowing S free to utilise the understanding of the information, even if it was for a rival.

In addition, although there maybe not evidence of a restrictive covenant explicit to S’s position that deals with sensitive materials, S would subject to an implied duty not to use the confidential information after her possible termination of employment, whether by notice or discharge. The contract of employment would usually outlines the material that would be deemed “confidential information” these usually comprises of such material as price lists, client information, consumer accounts, and quotes for tenders [10] .

Due to S’s senior (fiduciary [11] ) position within the company, and to access to more sensitive information. The courts may well be justifiably in subjecting S to heavier restrictions which would be implied, as opposed to the restrictions she signed as a junior employee which gave S little access to sensitive materials.

However, if B wishes to rely upon a “one-size fits-all” covenant when drafted, could render the covenant unenforceable by the court.

It is exceptional that a court will allow the enforcement of a restrictive covenant to be in place for a period no longer than 12 months, unless in unique and rare circumstances. The burden is on B to demonstrate that these circumstances were exceptional; usually however the courts are reluctant to restrict a person for no more than 6 months.

It would be logical to any business man that he would protect his “business interests”, unfortunately some immoral employers place upon their irrational restrictive covenants upon their workforce in a bid to prevent the employee(S) using the knowledge gained within the same industry.

However the court must examine what could be classed as a legitimate “business interest” a lot would be dependent upon the environment of which the business operates, and only relevant if the industry that person such S could damage B business by the use of the information S had been partial too, such as details of pricing structures, client database, and strategies which would be advantageous to M but would be serious harmful to B’s business, would be classed as legitimate, as long as the provision was reasonable and that protection be no longer than is strictly necessary to protect those interests.

However what is reasonable depends on certain elements the nature of profession the position the employee holds, in respect of S, as she is privy to quite exclusive and damaging material as a call centre manager and being as there are only 2 others places S as being in an exclusive position and as B has a presence throughout the UK. There for B would have a claim for legitimise and reasonableness. However, as a junior working in a Wakefield S would not have been legitimately restricted.

With all the evidence suggesting an enforceable restrictive covenant is applicable it could be render unenforceable if B dismisses S unlawfully, and therefore breaching the contract of employment, and evidence of the breach is found then any restrictive covenants are automatically void.

A common course of breach in such cases is “Garden Leave [12] ” regardless of the fact there are no express contractual provisions within a contract, as in such circumstances, restrictive covenants unlikely to be enforceable, and in respect of this, not a viable avenue for B. However, if S was to give notice, rather than being given notice, S would remain bound any restrictive covenants, unless S could persuade the court that they are unreasonable and therefore unenforceable.

In seeking a remedy, the only action available to B would be an application for an interlocutory injunction awaiting a full hearing and therefore preventing future harm until the evidence is heard before a trial, this is dependent upon the granting of such an injunction. In order for the court to be satisfied before granting or refusing an application for an interlocutory injunction.

The court must consider:

Firstly would damages be appropriate, but must consider if an individual is in a position in which to pay.

On granting or refusal of the injunction, would its application cause more harm than good.

Also, to the conduct and relations between the parties.

Regardless whether a restrictive covenants is present, is would not mean any covenant would be enforceable against S in protection of B’s legitimate business interest, whether or not B’s restrictive covenants is enforceable will ultimately be a matter for a court to decide. However, a balance between those seeking to protect a “legitimate business interest” and prevention of the authorised use of confidential information [13] and those seeking employment else’s where, even if it were for a rival competitor.

Assuming what the Chief Executive Officer (CEO) statement was correct, and the belief that no clause exists. Then it is likely that an interim- injunction would be provided by the courts to protect the confidential information until such time as would within the public domain which in this instance would be January, additionally S was in a fiduciary position [14] and did breach her implied duties of mutual trust and confidence [15] , and find in favour of B and an award of damage stemming from the breach. Other elements the courts may wish to examine on behalf of S could be Articles 8 and 10.