Decision: The High Court has granted an injunction holding an investment manager to a 12 month garden leave period. The Court agreed that the employer firm needed at least 12 months to try and cement the client relationships (left behind by the departing employee) because client contact in that industry typically happened only a few times a year. It accepted that the firm could not be over-aggressive in its attempts to secure the clients as this would be considered too much of a ‘hard sell’.
Impact: This is a useful case for employers trying to enforce lengthy garden leave periods. Here, the lack of regular client contact was an important factor and the same arguments would apply in sectors such as insurance where an annual renewal cycle is the norm. Departing employees often argue that their former employer has not acted quickly enough to secure clients and this case will also offer some comfort in that regard as the court did not expect the employer to be ‘too pushy’. It is still true however that employers in this situation need to show that they are taking steps to retain the client base, otherwise injunctions will be much harder to obtain.
J M Finn & Co Limited v Thomas Brook Holliday