Can You Legally Include a Non-Compete Clause in UK Staff Contracts?

Can You Legally Include a Non-Compete Clause in UK Staff Contracts?

Restricting employees from working for competitors after they leave your company sounds like a smart business move. But are non-compete clauses actually enforceable in the UK?

The answer? Sometimes, but only if they are fair, reasonable, and justifiable. If a clause is too restrictive, a court may strike it down, leaving you with no protection at all.

So, what are the rules around non-compete clauses, and how can you use them legally?

Here’s everything UK employers need to know.

What is a Non-Compete Clause?

A non-compete clause (also called a post-termination restriction) is a contract term that prevents an employee from working for a competitor or starting a competing business for a set period after leaving your company.

For example, a sales director might be restricted from working for a direct competitor within a 20-mile radius for six months after their employment ends.

Are Non-Compete Clauses Legal in the UK?

Yes, but they must be reasonable and designed to protect a legitimate business interest—not just to stop someone from getting another job.

UK courts generally won’t enforce a blanket ban that prevents an employee from working anywhere in the same industry. Instead, a valid non-compete clause should:

✅ Protect genuine business interests (e.g., trade secrets, client relationships)
✅ Be limited in duration (usually 3-12 months, depending on the role)
✅ Be geographically reasonable (a national ban is unlikely to be upheld)
✅ Be proportionate to the employee’s seniority and access to sensitive information

If a clause is too broad or restrictive, it may be considered unenforceable, meaning the employee can ignore it and work wherever they like.

What Can You Protect With a Non-Compete Clause?

Courts will only uphold non-compete clauses that protect legitimate business interests. These may include:

🏢 Protecting company secrets – Preventing an ex-employee from taking confidential business strategies to a competitor.

🤝 Protecting client relationships – Stopping an ex-employee from taking key clients with them.

🏆 Preserving competitive advantage – Ensuring employees with unique business knowledge don’t immediately strengthen a rival company.

💡 Important: You cannot enforce a non-compete clause just to punish an ex-employee or limit their career opportunities.

How Long Can a Non-Compete Clause Last?

There’s no set legal limit for how long a non-compete clause can last in the UK. However, courts typically consider 6 months to be reasonable for most roles. 12 months may be acceptable for very senior roles with access to high-level confidential information.

Anything longer than 12 months is rarely enforceable unless exceptional business interests are at stake.

How to Make a Non-Compete Clause Enforceable

To ensure your non-compete clause is legally valid:

✅ Be specific – Clearly define what is restricted (e.g., “You cannot work for X competitors within 10 miles for 6 months”).

✅ Justify the restriction – Explain why it is necessary to protect the business.

✅ Keep it reasonable – Don’t impose overly harsh limits on job opportunities.

✅ Review it regularly – Update clauses as roles and industries evolve.

🔍 Pro Tip: Use alternative clauses like non-solicitation (preventing ex-employees from poaching clients) or non-dealing (stopping them from working with former clients) if a full non-compete isn’t necessary.

What Happens if an Employee Breaks a Non-Compete Clause?

If an ex-employee breaches a valid non-compete clause, you can take legal action, which may include:

⚖ Seeking an injunction – A court order preventing them from working for a competitor.

💰 Claiming damages – Compensation for any financial loss caused by the breach.

🤝 Negotiating a settlement – Resolving the issue outside of court.

However, if the clause is too broad or restrictive, a court may declare it unenforceable, leaving you without any protection.

To Sum Things Up

✅ Non-compete clauses are legal in the UK, but only if they are reasonable and necessary.

✅ They must protect genuine business interests, such as trade secrets or client relationships.

✅ A typical non-compete lasts 3-6 months—anything longer must be strongly justified.

✅ If a clause is too restrictive, it may not hold up in court.