The following restrictions are set out in a contract of
employment:
The employee shall not:
Both restrictions apply for a period of 18 months after
cessation of employment.
The employee was required to agree to the restrictions as
conditions of the employment. No payment was made to the employee
for agreeing to the conditions during the course of the employment.
The following line was included in a letter of termination:
"I confirm that the conditions set out in the contract of
employment continue to apply for 18 months following the date of
this letter."
Section 225 does not apply as no consideration has been paid for giving the restrictive undertakings. No new undertakings were included in the termination agreement. The letter simply re-affirmed the conditions set out in the contract of employment.
As above but the letter of termination identifies a payment of £25,000 as consideration for the departing employee agreeing to abide by the terms of the contract of employment.
The sum of £25,000 is within Section 225 as it is paid for the giving of undertakings. The "giving" and the payment are linked even though time has elapsed between the 2 events.
