Restrictive covenants (UK): the post-termination restrictions explained

Restrictive covenants are the clauses that limit what you can do after a contract ends. The main ones are the non-compete, non-solicitation, non-dealing and non-poaching clauses, usually grouped with garden leave and confidentiality. In the UK they share a single legal test: every post-termination restraint is void unless it protects a legitimate business interest and goes no wider than reasonably necessary.

This page is the map. It explains the family and links out to each clause, so you can see which one you are actually being asked to sign.

Key Takeaways

• Restrictive covenants are a heading, not a single rule. Each clause under it is tested on its own.
• Every post-termination restraint is void by default and only binds you if it is reasonable and no wider than necessary.
• Tillman v Egon Zehnder confirmed courts can delete offending words but will not rewrite a covenant to save it.
• The wider a covenant is on scope, time or geography, the weaker it usually becomes.

What clauses count as restrictive covenants?

Restrictive covenants are the group of post-termination clauses that carry on binding you after you leave. You find them near the end of employment contracts and service agreements, often under "Restrictions", "Restrictive Covenants" or "Post-Termination Obligations".

The family usually includes:

• Non-compete: stops you working for a competitor or setting up a competing business for a period.
• Non-solicitation: stops you actively approaching the clients, suppliers or staff you dealt with.
• Non-dealing: goes further than non-solicitation, stopping you dealing with those clients at all, even if they approach you.
• Non-poaching: stops you recruiting former colleagues.
• Garden leave: keeps you employed but away from work during notice, before the post-termination restrictions even start.

Confidentiality obligations are often bundled in here too, though they work a little differently, protecting information rather than restricting where you work.

What restrictive covenants mean for you

The key thing to understand is that "restrictive covenants" is a heading, not one obligation. Under it sit several separate clauses, and each is judged on its own wording. One might be reasonable and bind you, while another in the same contract is too broad and falls.

That is good news when you are reviewing a contract. You do not have to accept the block as a whole. You can look at each covenant, ask what interest it protects, and negotiate the ones that reach too far.

Take a hypothetical. Your contract has a tight non-solicitation clause covering clients you personally handled, and a sweeping non-compete banning any competing work in the UK for two years. The first may well hold; the second is the kind of over-reach a court may cut back. Reading them separately is the whole point, and it is what our guide to restrictive covenants in employment contracts does in depth.

How does UK law test restrictive covenants?

They all run through one doctrine. Every post-termination restraint is governed by the common-law doctrine of restraint of trade: any clause that restricts your freedom to work is void as contrary to public policy, unless the business can show it is reasonable.

To be reasonable, a covenant must:

1. Protect a legitimate business interest, such as confidential information, trade secrets, or client and supplier connections. Simply not wanting competition is not enough.
2. Go no wider than reasonably necessary to protect that interest, in what it restricts, how long it lasts, and the area it covers.

The leading modern case is Tillman v Egon Zehnder Ltd [2019] UKSC 32. The Supreme Court confirmed that a court can sever offending words, sometimes called the blue-pencil test, if what is left still works and the overall effect does not change. What a court will not do is rewrite the clause to make an unreasonable restriction fair. Freelancers should note that courts often scrutinise a restraint harder still when you get no pay during the restricted period, which is covered in our guide to non-compete clauses in freelance contracts.

Restrictive covenants: a reasonable version vs an aggressive one

The wider a covenant is on any one of these, the weaker it usually is, and the more worthwhile it is to negotiate up front.

What to push back on before you sign

• Read each covenant separately. Do not treat the block as one. Judge the non-compete, non-solicitation and the rest on their own terms.
• Ask what interest each one protects. If the business cannot point to real confidential information or client relationships, that covenant has weak foundations.
• Narrow scope, time and area. Trim each covenant to what genuinely reflects your role.
• Get changes in writing. A verbal "we would never enforce it" is worth nothing once the contract is signed.

If you are not sure which restrictive covenants in your contract are standard and which reach too far, upload it to Ookulli and it will flag each one, with the point traced back to the UK law behind it.

This page is general information, not legal advice. The restraint of trade rules described here are English law, and apply in England and Wales; Scotland and Northern Ireland take their own approach. For a high-value or complex situation, speak to a qualified solicitor.