A new role may be ready to start, but the restrictions you agree when leaving can affect what you are able to do next. This guide to post termination restrictions explains the clauses commonly found in UK employment contracts and settlement agreements, what they may prevent, and where there may be room to negotiate.
Post-termination restrictions are often described as restrictive covenants. They are designed to protect an employer after employment ends, usually by limiting contact with clients, colleagues, suppliers or competitors for a defined period. They can be legitimate, but they should not be accepted as standard wording without careful review.
What are post-termination restrictions?
A post-termination restriction is a contractual promise that applies after your employment has ended. It may already appear in your employment contract, or be repeated, amended or newly introduced in a settlement agreement.
The precise wording matters. A clause that says you cannot work for a competitor is very different from one that prevents you from approaching clients with whom you had material dealings in the previous 12 months. A settlement agreement may also confirm that existing restrictions remain in force, even where the agreement itself does not set out the full wording.
The most common restrictions concern non-compete activities, non-solicitation of customers or staff, non-dealing with customers, and non-interference with suppliers or other business contacts. Some agreements also contain obligations about confidential information, company property, announcements and social media.
The restrictions you are most likely to see
A non-compete clause seeks to stop you from working for, setting up or helping a competing business. This is usually the most significant restriction because it can directly affect your choice of future employment. Its scope may depend on the type of work you would carry out, the businesses defined as competitors and the geographical area covered.
A non-solicitation clause normally prevents you from actively encouraging clients, customers or colleagues to move away from your former employer. It does not always prevent a client or former colleague from approaching you without prompting, although the wording must be checked carefully.
A non-dealing clause goes further. It can prevent you from doing business with certain customers even if they make the first approach. This can be particularly restrictive for sales professionals, account managers, consultants and senior employees with long-standing client relationships.
A non-poaching clause, sometimes called a non-solicitation of employees clause, restricts attempts to recruit former colleagues. The definition of a protected employee is important. It may cover only senior staff or anyone employed by the business.
Confidentiality obligations are slightly different. They do not usually stop you taking a new job, but they can prevent you using or disclosing trade secrets, customer information, pricing, strategy and other confidential material. These duties may continue for an indefinite period in relation to genuine trade secrets.
Are post-termination restrictions enforceable in the UK?
Not every restriction is enforceable simply because it appears in a signed document. Under English law, a post-termination restriction must protect a legitimate business interest and go no further than is reasonably necessary to protect it.
Legitimate interests may include confidential information, customer connections, supplier relationships and workforce stability. Preventing ordinary competition, without more, is not generally enough. The employer must be able to show why the restriction is justified for the role you held and the information or relationships you had.
A tribunal or court would look closely at the wording, duration, geographical reach and the people or businesses covered. A six-month restriction may be reasonable for a senior executive with influence over key clients, yet excessive for a junior employee with no client responsibility. There is no single acceptable period. The answer depends on the facts at the time the restriction was agreed.
That said, it is rarely sensible to assume a clause can safely be ignored. Even a restriction that appears broad may lead to dispute, delay or costly correspondence when you are trying to move on. Obtain advice before acting in a way that could be alleged to breach it.
A guide to post termination restrictions in settlement agreements
A settlement agreement is an opportunity to check whether restrictions are being preserved, expanded or introduced for the first time. The agreement should make this clear. You should not have to piece together your obligations from a combination of contract clauses, schedules and broad statements that you have complied with every duty owed to the employer.
Look first for a clause confirming that restrictive covenants in your employment contract continue after termination. Compare it with your original contract. Has the duration changed? Has the list of protected customers been widened? Is a new non-compete restriction being added? These are meaningful changes, not administrative details.
A settlement agreement may also include a warranty that you have not accepted another role that would breach your obligations. If you have a job offer, are setting up a business or are in discussions with a potential client, this needs careful attention. A warranty should not force you to make a statement that is uncertain or untrue.
For employees, independent legal advice is required for a settlement agreement to validly waive statutory employment claims. That advice should cover the practical effect of post-termination restrictions as well as the claims being settled, compensation, tax treatment, confidentiality and reference wording.
What to check before you sign
Start with the question: what does this prevent me from doing in real life? Read the clause alongside your likely next step, rather than treating it as abstract legal language.
Consider the following points:
- Duration: How long does the restriction last? Periods often run from the termination date, although the wording should be checked where garden leave is involved.
- Restricted activities: Does it apply only to work that competes with your former role, or to any work for a competing organisation?
- Protected contacts: Are customers limited to people you dealt with recently, or does the clause cover every customer, prospect or supplier of the business?
- Geographical scope: Is the area relevant to your work, particularly if your role was UK-wide or international?
- Definitions: Are terms such as competitor, customer, senior employee and confidential information defined with sufficient precision?
- New obligations: Does the settlement agreement impose restrictions that were not in your employment contract?
It is also worth checking the interaction with any garden leave provision. During garden leave, you remain employed and are normally paid, but may be instructed not to work or contact clients. A post-termination restriction then starts afterwards. Together, the two periods can create a lengthy practical barrier to a new role.
Can restrictive covenants be negotiated?
Yes. A proposed settlement agreement is a commercial negotiation, and restrictive covenants can form part of it. Whether an employer will agree to changes depends on the role, the reason for departure, the risk it sees and the overall settlement package.
Useful changes may include reducing the duration, limiting customer restrictions to contacts you worked with in a stated period, removing a non-compete clause, or adding a clear carve-out for a named new employer or role. If you are joining a business that overlaps only partially with your former employer, a tightly drafted exception may offer more protection than vague reassurance given in conversation.
Where an employer wants a new or stronger restriction, it is reasonable to ask why it is needed and whether the settlement payment reflects the added limitation. A payment made under a settlement agreement does not automatically make every covenant enforceable, but the commercial value of what you are being asked to give up should be considered.
Employers also benefit from clarity. Overly broad wording may create uncertainty rather than protection. A focused covenant that addresses a genuine risk is more likely to be credible, easier to explain and less likely to derail an otherwise amicable exit.
Do not overlook confidentiality and non-disparagement clauses
Restrictions on future work are only one part of the picture. Settlement agreements commonly include confidentiality clauses covering the agreement, its terms and the circumstances of termination. They may also contain non-disparagement obligations that limit negative statements about the employer or individuals.
These clauses should allow appropriate disclosures, such as speaking to a spouse or partner, professional advisers, HMRC, regulators or the police where necessary. They should not prevent protected disclosures or reporting wrongdoing. The wording should also be mutual where that is appropriate, particularly if the agreement requires you to protect the employer’s reputation.
Before you sign, ask for clear, independent advice on what you are agreeing to, how it affects your planned next move and whether the terms genuinely match the circumstances of your departure. A carefully reviewed agreement can give both sides the certainty to leave matters behind and let you take the next opportunity with confidence.



