Restraint Of Trade South Africa Agreement

Individuals should be free to sell their skills and trade in the marketplace for a living. It is a fundamental constitutional right. They are also free to freely conclude legally binding treaties, such as trade restrictions. And after entering into a free contract, they are expected to keep their promises. It follows that if a person freely signs a trade restriction and then wants the court to set it aside, he does ask the court to tolerate his lack of promises. Second, all people should be productive in the interests of society and be allowed to work in commerce, commerce or professions for a living. The questions that should be asked when considering the appropriateness of a deduction are, first of all, whether one party has an interest worthy of the protection of termination of employment and, if so, is that interest threatened by the other party? If there is a reasonable interest and the worker may assign it, the court will ascertain whether the duration and geographic area are reasonable for detention. The shorter the restriction period, the smaller the area for which it applies – the more reasonable the restraint. For example, a two-year restriction that covers the entire country might be unreasonable – but a six-month restriction that covers the province where the employer`s business is primarily active might be reasonable. In determining the adequacy of an employer`s trade restriction, a court will consider the company`s ownership interest in relation to the extent of the restriction on the geographic area and duration of the restriction and the capacity in which the worker is prevented from working. In Reddy v Siemens Telecommunicals (Pty) Ltd 2007 2 SA 486 (SCA), the Tribunal found favourable to the employer. Reddy, who worked at Siemens, resigned to take a position at Ericsson. He had agreed that after joining Siemens, one year after his employment was terminated, he would not be employed by a competitor and had agreed not to disclose Siemens` trade secrets and confidential information.

In preventing Reddy from holding a job at Ericson, the court found that the reluctance was to prevent a person with knowledge of confidential technologies because of his or her job from using it to the detriment of the employer. Tribunal held that “these are confidential technologies that must be protected, there is no need for the plaintiff to prove that the information is not in [Ericsson`s] hands is academic. This information, which is in the hands of a competitor, may, by its very nature, be detrimental to the applicant`s activity. When a court is to determine the adequacy of a trade clause, it must make a value judgment on the two main political considerations.