In an important victory for all employers, the Court of Appeal has upheld the High Court injunction obtained by interdealer broker Sunrise against one of its employees who refused to work his notice period after being hired by a competitor.
Sunrise convinced the Court of Appeal that its departing employee should be held to a period of notice with post termination restrictive covenants to apply thereafter.
The Sunrise Brokers LLP vs. Rodgers appeal result represents a victory of common sense for all employers in relations to notice periods, restrictive covenants and garden leave.
Sunrise Brokers, represented by Michael Duggan QC and Twenty Twenty Law, argued that no work = no pay and that a period of notice and restrictions that applied after employment ended were both separately valid and in place for good reason and should be honoured.
The Court of Appeal agreed that Sunrise had not acted unreasonably in holding the employee to a period of notice without pay where he refused to attend work and stated what was required was a “realistic evaluation of whether the pressures operating on the employee … are in truth likely to compel him to [return to] work for [the] employer.” The Court was unconvinced that the employee would be compelled by financial hardship to be forced to return to work at Sunrise.
Paul Chiappe, General Counsel, Sunrise Brokers, said, “This is a common sense victory, not just for the interdealer broker industry but for all employers. No employee should be paid for refusing to attend work without good reason during a period of notice and the decision on whether or not to activate garden leave must always be that of the employer alone.
We strongly believe in protecting our business from our competitors trying to poach our highly valued and stellar staff. As the Court of Appeal decision shows, we have in place robust contractual arrangements to protect this important asset.”