While a restraint agreement comes into effect only once his contract has ended, while he's employed by you, your employee's automatically restrained from competing with you, misappropriating your property (including confidential information), or secretly profiting at your expense.
He's legally bound to serve you faithfully and honestly.
But what happens when you find he's breached this legal duty and is competing with your business?
Here's what to do if your current employee is competing with your business
According to the Labour Law for Managers Loose Leaf Service, you can discipline an employee who breaches these duties of good faith, loyalty and honesty while working for you.
You may even be able to dismiss him if you can show:
For example, Rachel reports to you that Eddie has bought shares in a rival publishing company and has given your list of writers to it.
Following a legal procedure (informing Eddie of the allegations against him and allowing him time to respond, after consultation with a trade union representative if he so wishes), you need to:
The bottom line: You don't need a restraint of trade agreement to discipline a current employee who's been competing with you. You need only prove she's guilty of doing so, at a fair hearing following a fair procedure.
Knowing how to deal with an employee who's competing with your business will help ensure you deal with him in a legal manner.