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The Government has, somewhat unexpectedly, published a working paper on options for the reform of non-compete clauses in employment contracts. The Government seeks views on a number of proposals to curtail the use of non-competes in the UK workforce.
This is not the first time that the Government has considered such legislation.
In 2016, the previous Government issued a call for evidence and concluded that restrictive covenants were “a valuable and necessary tool for employers to use to protect their business interests and do not unfairly impact on an individual’s ability to find other work”.
Then in 2020, the previous Government opened a consultation on measures to reform non-compete clauses in contracts of employment. The consultation proposed two main options for reform: 1) mandatory compensation for non-compete clauses; and 2) an outright ban on non-compete clauses.
In 2023, the previous Government published its response to the consultation. Interestingly, the response confirmed that neither of its proposed options for reform would be pursued and instead a statutory limit of three months on non-compete clauses in employment contracts would be introduced. We covered this development in our Law-Now article: UK government’s response to non-compete consultation. However, nothing came of the proposals and reform to non-compete clauses did not appear in any party’s manifesto during the 2024 General Election.
Tentative references had been made to this...
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