Non-Compete Agreement with Employee - Template Form Pro · AU-law

NON-COMPETE AND RESTRAINT OF TRADE AGREEMENT

THIS NON-COMPETE AND RESTRAINT OF TRADE AGREEMENT ("Agreement") is made and is effective as of ________ ("Agreement Date").

BY AND BETWEEN THE EMPLOYER (hereinafter "Employer"):

________ (ACN/ABN ________) of the following address:

________

AND THE EMPLOYEE (hereinafter "Employee"):

________ of the following address:

________

(referred to herein as "Parties" or individually as "Party")

(1) BACKGROUND

(a) The Employee is currently employed, or will be employed in the future, by the Employer in the position of ________ (which is hereinafter referred to as "the Employment Relationship").

(b) During the course of the Employment Relationship the Employee will, or may, gain access to the Employer's Confidential Information, trade secrets, client and supplier connections and goodwill, all of which constitute legitimate business interests of the Employer's business ("the Business").

(c) The Employee may, either during the Employment Relationship or after the Employment Relationship has terminated, have an opportunity to obtain an unfair competitive advantage over the Business, or to compete with the Business in such a way that may cause harm or damage to the Business.

(d) The Parties have chosen to enter this Agreement in order to protect the legitimate business interests of the Employer, and the Employee acknowledges that the restraints set out in this Agreement are reasonable and go no further than is reasonably necessary to protect those interests.

(2) CONDITION OF EMPLOYMENT AND CONSIDERATION

(a) In consideration of the offer and continuation of employment, the payment of the Employee's remuneration and the mutual commitments and obligations made by the Parties, the Parties agree that the execution of this Agreement is a condition of the employment of the Employee by the Employer.

(b) The Employee acknowledges that this Agreement operates in addition to, and not in substitution for, any duties owed by the Employee to the Employer at common law, in equity or under any contract of employment between the Parties dated ________.

(c) Nothing in this Agreement is intended to exclude, restrict or modify any entitlement of the Employee under the Fair Work Act 2009 (Cth), any applicable modern award or enterprise agreement, or the National Employment Standards.

(3) NON-COMPETE COVENANT

(a) During the Employment Relationship and for the time period as described in the "Time Period" clause of this Agreement (which shall hereinafter be referred to as the "Time Period"), the Employee will not directly or indirectly engage in any business that competes with the Business within the Geographic Area.

(b) Directly or indirectly engaging in any competitive business includes, but is not limited to:

(I) engaging in a business as owner, partner, or agent;

(II) becoming an employee of any third party that is engaged in such business;

(III) becoming interested directly or indirectly in any such business; or

(IV) soliciting any customer of the Employer for the benefit of a third party that is engaged in such business.

(c) The Employee agrees and warrants that this restraint will not adversely affect the Employee's ability to earn a livelihood and that the restraint is reasonable in all the circumstances.

(d) This covenant shall apply to the geographic area as described in the "Geographic Area" clause of this Agreement (which shall hereinafter be referred to as the "Geographic Area").

(4) NON-SOLICITATION COVENANT

(a) During the Employment Relationship and for the Time Period (as described in the "Time Period" clause of this Agreement), the Employee will not directly or indirectly solicit business from, or attempt to sell, license, or provide the same or similar products or services as are now provided to, any customer or client of the Employer.

(b) During the Employment Relationship and for the Time Period, the Employee shall not directly or indirectly induce, solicit, or endeavour to entice away from the Employer any employee, contractor, agent or supplier of the Employer.

(c) During the Employment Relationship and for the Time Period, the Employee shall not use the Employer's existing client demographic and Confidential Information to solicit and provide quotes and/or transfer business to any competing entity.

(5) CONFIDENTIALITY

(a) The Employee hereby acknowledges and agrees that the Employee may have, or may have had, access to information that is confidential and/or commercially valuable to the Employer ("Confidential Information"), which may include but is not limited to:

(I) information of whatever nature relating to the business activities, practices and finances of the Employer;

(II) any other evaluation material, design work, technologies, technological ideas or strategies, strategic plans and ideas, marketing strategies, innovations, creative plans, concepts and any other plans or ideas developed by the Employer or on its behalf, or used by the Employer, whether relating specifically to the Employer's business or otherwise;

(III) any personal information within the meaning of the Privacy Act 1988 (Cth) relating to the Employer's clients, customers, employees or contractors;

(IV) any information derived from any other information which falls within this definition of Confidential Information; and

(V) any copy of any Confidential Information,

but does not include information which:

(I) was known or in the possession of the Employee before it was provided to the Employee by the Employer, provided that it was known or in the possession of the Employee through legal means, and not as a result of any breach of this Agreement or any other agreement or obligation relating to confidentiality (whether or not the Employee was a party to such other agreement or obligation);

(II) is, or becomes, publicly available, through no fault of the Employee;

(III) is or was provided to the Employee without restriction or disclosure by a third party, who did not breach any confidentiality obligations by making such a disclosure;

(IV) is or was provided to the Employee by the Employer and marked "Non Confidential"; or

(V) is required by law or regulation to be disclosed, but in the event that this exception applies, it applies only to the absolute minimum necessary and provided that the Employer is first consulted to establish whether and if so how far it is possible to prevent or restrict such enforced disclosure.

(b) During the Employment Relationship and at all times after its termination, the Employee shall keep the Confidential Information confidential and secret.

(c) During the Employment Relationship and at all times after its termination, the Employee shall only use the Confidential Information in accordance with the purpose for which it was provided by the Employer, or as otherwise directed by the Employer.

(d) The Employee shall, in dealing with any personal information, comply with the Australian Privacy Principles under the Privacy Act 1988 (Cth) and with the Employer's privacy and data handling policies as varied from time to time.

(e) Upon termination of the Employment Relationship, or earlier upon request, the Employee shall immediately return to the Employer all Confidential Information and all property of the Employer in the Employee's possession, custody or control.

(f) If there is any doubt as to whether any particular information constitutes Confidential Information, the Employee should presume it is Confidential Information, until the Employee obtains explicit confirmation from the Employer that it is not Confidential Information.

(g) This clause will survive termination or expiration of this Agreement.

(6) TIME PERIOD

(a) For the purposes of this Agreement, "the Time Period" means, from the date of termination of the Employment Relationship, the following amount of time:

(I) twelve months;

(II) six months;

(III) three months;

(IV) two months;

(V) one month,

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(b) This clause will survive termination, expiration or completion of this Agreement.

(7) GEOGRAPHIC AREA

(a) For the purposes of this Agreement, "the Geographic Area" means, from the Employer's address recorded above, a distance of:

(I) ten kilometres;

(II) five kilometres;

(III) four kilometres;

(IV) three kilometres;

(V) two kilometres;

(VI) one kilometre,

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(b) This clause will survive termination, expiration or completion of this Agreement.

(8) REASONABLENESS OF RESTRAINTS

(a) The Employee acknowledges and agrees that each of the restraints contained in clauses (3), (4), (6) and (7) is reasonable in its application to the protection of the legitimate business interests of the Employer and goes no further than is reasonably necessary to protect those interests.

(b) Where this Agreement is governed by the law of New South Wales, the Parties acknowledge the operation of the Restraints of Trade Act 1976 (NSW), and agree that the restraints are to be read down to the extent necessary to render them valid and enforceable.

(9) ENTIRE AGREEMENT

This Agreement contains the entire agreement of the Parties regarding the subject matter of this Agreement, and there are no other promises or conditions in any other agreement, whether oral or written.

(10) SEVERABILITY

(a) In the event that any provision of this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the remaining provisions shall not be affected and shall continue to be valid, legal and enforceable as though the invalid, illegal or unenforceable parts had not been included in this Agreement.

(b) Where any provision of this Agreement is found to be invalid, illegal or unenforceable, but would be valid, legal or enforceable if some part of that provision were deleted or modified, that provision shall apply with such deletion or modification as may be necessary to make it valid, legal and enforceable.

(c) This clause will survive termination or expiration of this Agreement.

(11) INJUNCTION AND REMEDIES

(a) It is agreed that if the Employee violates the terms of this Agreement, irreparable harm may occur, and damages alone may be insufficient to compensate the Employer.

(b) In the event of a breach or threatened breach of this Agreement, the Employer will be entitled to seek injunctive relief (i.e. a court order requiring compliance with this Agreement), in addition to any other remedy available at law or in equity, to enforce the terms of this Agreement.

(c) In case of litigation, the prevailing party shall have the right to recover from the other party its reasonable costs and necessary disbursements and legal fees incurred in enforcing this Agreement, subject to any order of the court.

(12) WARRANTIES REGARDING COMPETITION

(a) Each Party hereby respectively warrants:

(I) That this Agreement does not relate to a contract, arrangement, or understanding, or a concerted practice for the purpose, or with the likely effect, of substantially lessening competition according to the Competition and Consumer Act 2010 (Cth) ("CCA");

(II) That this Agreement does not relate to some kind of exclusive dealing between the Parties, for the purpose, or with the effect or likely effect, of substantially lessening competition according to the CCA;

(III) That this Agreement does not relate to some kind of arrangement involving "cartel conduct" or "price fixing" according to the CCA, whereby competitors have agreed on pricing rather than competing against each other;

(IV) That this Agreement does not relate to some kind of arrangement involving "output restrictions" according to the CCA, whereby competitors have agreed to prevent, restrict, or limit the volume or type of particular goods or services available;

(V) That this Agreement does not relate to some kind of arrangement involving "market sharing" according to the CCA, whereby competitors have agreed to divide or allocate customers, suppliers, or territories among themselves rather than allowing competitive market forces to work; and

(VI) That this Agreement does not relate to some kind of arrangement involving "bid rigging" or "collusive tendering" according to the CCA, whereby competitors have agreed they will not compete genuinely with each other for tenders, allowing one of the competitors to 'win' the tender.

(b) This clause will survive termination or expiration of this Agreement.

(13) WARRANTIES REGARDING LEGAL ADVICE

(a) Each Party (which for the purposes of this clause shall be referred to as the "Warranting Party" as the context requires) hereby respectively warrants:

(I) That the Warranting Party fully understands the terms of this Agreement.

(II) That the Warranting Party has had the opportunity to obtain independent legal advice in relation to the matters addressed by this Agreement and the Warranting Party has either:

(A) taken such independent legal advice; or

(B) elected not to take such independent legal advice.

(III) That the Warranting Party has not been induced to enter this Agreement by any representation(s) made by the other Party or by any officer, employee, director, agent, contractor, assignee, successor or other representative of the other Party, except as provided in this Agreement.

(b) This clause will survive termination or expiration of this Agreement.

(14) APPLICABLE LAW AND JURISDICTION

(a) This Agreement shall be governed by and construed in accordance with the laws in force in ________.

(b) Each Party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of ________ and the courts competent to determine appeals from those courts.

(15) BINDING

The provisions of this Agreement shall be binding upon and inure to the benefit of both Parties and their respective legal representatives, successors, and assigns.

(16) SURVIVAL OF OBLIGATIONS

Notwithstanding any other provisions of this Agreement, at the termination, expiration or completion of this Agreement, any provisions of this Agreement which would by their nature be expected to survive termination, expiration or completion shall remain in full force and effect, including but not limited to any provisions which are explicitly stated to survive termination, expiration or completion.

(17) NO WAIVER

None of the powers or rights created under the terms of this Agreement shall be deemed to have been waived by any act or acquiescence of either Party. A power or right under the terms of this Agreement may only be waived in writing, signed by the Party that is waiving the said power or right. No waiver of any power or right under a term of this Agreement shall constitute a waiver of any other power or right or of the same power or right on a future date. Failure of either Party to enforce any term of this Agreement shall not constitute waiver of such term or any other term.

(18) COUNTERPARTS

This Agreement may be executed in any number of counterparts, including by electronic signature and exchange, all of which together shall constitute a single agreement. If the dates set forth at the end of this document are different, this Agreement is to be considered effective as of the date that both Parties have signed the Agreement, which may be the later date.

(19) FURTHER ACTS

Each Party must, and must ensure that its directors, employees, officers, agents, representatives and contractors, do all things and sign, execute and deliver all documents, agreements and instruments as reasonably required in order to give effect to this Agreement and to the rights and obligations of the Parties created under this Agreement.

EXECUTED AS AN AGREEMENT ON ________

Signed for and on behalf of ________ in accordance with s127 of the Corporations Act 2001 (Cth) by:

___________________________________
Signature of director

____________________________________
Name of director

___________________________________
Signature of director/secretary

____________________________________
Name of director/secretary

Signed by ________:

____________________________________
Signature

____________________________________
Print name

____________________________________
Date

In the presence of:

____________________________________
Witness Signature

____________________________________
Witness Name

____________________________________
Witness Occupation

____________________________________

____________________________________
Witness Address