Restrictive Covenants – Legitimate business interests

The employer is only entitled to protect certain specific business interests. These fit into three broad categories:

  1. Trade connections (with clients, suppliers, distributors and possibly potential clients, suppliers, distributors);
  2. the employers workforce; and
  3. trade secrets (confidential information).

Only if the restrictive covenants seeks to protect the company from damage to one of these three categories, will the court move on to assess whether the clause is reasonable in the manner it seeks that protection.