The Relationship between Restraints of Trade and Garden Leave
DOI:
https://doi.org/10.17159/1727-3781/2017/v20i0a1278Keywords:
employment contract, restraint of trade, garden leave, proprietary interest and reasonableness.Abstract
The purpose of the article is to examine the relationship between a so-called "garden leave" clause and a post-termination restraint of trade clause in employment contracts, in view of the decision in Vodacom (Pty) Ltd v Motsa 2016 3 SA 116 (LC). The Labour Court grappled with the question of whether the enforcement of the garden leave provision impacts on the enforcement of a post-termination restraint of trade clause. Enforcement of both these types of clauses may be problematic. It can result in unfairness if an employee ends up being commercially inactive for a long period. The author argues that garden leave has a direct effect on the enforcement of a post-termination restraint of trade clause. Accordingly, a restraint of trade will be enforced only if the employer's proprietary interest requires additional protection beyond what is achieved under the garden leave clause.
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DuMoulin M 2016 Garden Leave and Restraint of Trade Agreements - Can Garden Leave be an Effective Substitute for a Restraint Undertakings or can it Cause the Restraint Undertaking to be Unenforceable? http://www.lexology.com/library/detail.aspx?g=8fb6b0ac-7ee2-4f7c-80b5-a9b3bc618e20 accessed 27 March 2016
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Copyright (c) 2017 YEUKAI MUPANGAVANHU
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