With that knowledge and the relationships formed with customers, the departing employee may leave with an unfair competitive advantage over his or her former employer. When carefully drawn an agreement defining the limitations on the employee's post-employment activities can help to avoid costly and disruptive disputes. However, such agreements are not trouble-free. There is a continuum of possible post-employment restrictions. Departing employees might be precluded from entering into competition with the employer, precluded from serving customers, or precluded from soliciting customers.
Restrictions are generally limited in duration, scope of activities and geographic area.
The courts tend to be sympathetic to employees who are not given an appropriate opportunity to seek legal advice prior to signing such an agreement. It is in the interest of both employee and employer to ensure that the employee receives legal advice before the agreement is signed. Even where the employee has received legal advice, the employer cannot be sure that an agreement restricting post-employment activities will be enforced by the courts. Generally, the courts will refuse to enforce restrictions on post-employment activities unless the employer can show that the provisions are the least restrictive necessary to protect a legitimate proprietary interest. In Winnipeg Livestock v. Plewman , a livestock auction market sought to enforce an agreement which purported to prohibit its former principal auctioneer from providing auctioneering services to any competitor for a period of 18 months after he ceased to work for Winnipeg Livestock.