Employment Law-Skeletal Argument

Peter Griffiths Appellant-And-Park Fasteners Chester Limited Respondent Respondent’s Skeletal Argument

GROUND 1

1. It is well established in the English law of employment contracts that employee covenants are enforceable if they are to protect the legitimate interest of a business, extend to a period that is necessary to protect the business interest and are reasonable. (Brake brothers Limited v Ungless; kynixa limited v Hynes and others)
2. When an employee resigns, rather than being dismissed, he or she remains bound by the terms of the covenant. The appellant resigned and within less than two months, he had already joined another competing company. The action of the appellant breached Paragraph 1 and 2 of the covenant (Spafax Limited v Harrison and Taylor)
3. The covenant between Mr. Griffiths and Park Fasteners Chester Limited (hereinafter the company) is only meant to protect the interest of the company. Although the company has interest all over the UK, it found it reasonable only to restrict the covenant to the North West region - where majority of its customers are based. In such a case, the intention of the covenant can easily be discerned: to protect the company’s business interest and not to obstruct trade.
4. Although Stoke Building Materials Limited is outside the area restricted by the covenant, it is very clear that the company has business interest in North West. In his new job, Peter will be operating from Stoke Manchester offices, and it is clear from the evidence available that he will be dealing with customers mainly from North West. It is submitted that in business, the headquarters of a company is not really a factor, but the actual areas that a business operates in. In Manchester, Peter will be in direct contact with his Park Fasteners customers. There is evidence that Peter has already contacted one of the Company’s major customer is pointer of what is reasonably expected if the injections are lifted (Beckett Investment Management Group v Hall).
5. In the interest of the employees, the employment covenants are restricted to 6 months, while the law permits such contracts to extend to 12 months (Scully UK Limited v Lee; Thomas v Farr plc). The six months duration is designed with the understanding that employees need to utilise their professional skills and knowledge even after leaving the company. Thus, the company’s employee covenant should pass as both reasonable and lenient. It was the understanding of the company, that within 6 months, it should have recruited a replacement of a leaving employee and secured its interest. Less than this period, as is the case with the appellant situation is only detrimental to the company’s interests.
6. There could be a tendency to think that since fastener products only contribute 10 % of Stoke Building Materials Limited turnover, the company does not pose a threat to Park Fasteners business interest. But such an argument misses the realities and interest of why business exists. All business exists to expand and grow. The fact that fasteners product constitute only 10% of Stoke Building Materials limited turnover does not make it a non-competing company to Park Fasteners. The employment of Peter Griffiths by the Stoke company must be seen for what it is- a strategic poaching. This is done with the sole intention of encroaching into Park Fastener’s market. Believing that Stoke Materials Limited wound not like to increase its fasteners product sales would be contrary to business realities. Having worked for five years for a fasteners company, Peter Griffiths become a strategic poach for the company. With such a strategic recruitment, it is clear that the intention of Stoke building Materials Limited is to increase the sale of Fasteners products especially in the North West market. In that case, Park Fasteners Chester Limited has genuine business interest to protect (Beckett Investment Management Group v Hall)

GROUND 2

1. In breach of Paragraph 1 of the Employee covenants, the appellant contacted one of the company’s major customers. Although the discussion with the said customer was on building materials other than Fastener products, the signed covenant prohibit any direct or indirect dealing. More importantly, in realities of business, a salesperson discussion with a customer is not strict, and the only way Park Fastener can be assured of its interest is through enforcement of the covenant.
2. There is tampering with Park Fasteners Chester limited confidential information. A number of Peter’s notes of sales meetings with his old customers are missing from customer files. The company submits that these notes were struck from the customers file to be used for an ulterior motive. Lifting the injunction would therefore be detrimental to the company (Scully UK Limited v Lee).

References

NBeckett Investment Management Group Ltd. and others v. Hall and others [2007] EWCA Civ 613

Brake Borthers Limited v Ungless [2004] EWHC 2799

Kynixa Limited v Hynes and others [2008] EWHC

Scully UK Limited v Lee [1998] 1 ICR 259

Spafax Limited v Harrison and Taylor [1980] IRLR 442

Thomas v Farr plc and another [2007] EWCA Civ 118 CA