Feb 242012
 

Employers are always keen to know what they can do to stop staff taking clients and staff when they leave.

When two senior executives were terminated, their departure to a competitor was like a red rag to a bull for their old employer.

Red Bull got injunctions against two executives that left and went to work with a competitor.

On 30 November 2010, Red Bull's General Manager (Stacey) and Marketing Director (Graebner) were given notice of termination. Red Bull told both executives that it expected them to comply with the restraints in their employment contracts. Stacey was given six months notice plus a six month restraint and Graebner was given one months notice plus a twelve month restraint. The notice and restraint periods together stopped the executives from working with a competitor for 12 months.

During these restraint periods, both executives started work with a start-up company that was also marketing energy drinks.

The Supreme Court of NSW upheld the restraints, granting interim relief for the plaintiff. Stacey and Graebner were prohibited from taking up the competitive employment until their restraint periods had expired, even though, by the time the case was heard, the period was about to expire

The potential inconvenience to the executives did not have priority over their ex-employer's right to restrain them.

Red Bull Australia Pty Ltd v Stacey (2011) NSWSC 1212

See: http://www.austlii.edu.au/au/cases/nsw/NSWSC/2011/1212.html

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