Restrictive covenants & confidentiality

This overview outlines the Practice Notes in the subtopic 'Employee duties and restrictions on competition'.

All employees are under a duty of fidelity to their employer, which is also known as the duty of good faith, or of loyalty.

Fidelity is a broad concept containing a number of more specific duties, some of which overlap both with each other and with the duty of trust and confidence:

1. •

   to behave honestly

2. •

   not to work in competition

3. •

   not to make a secret profit

4. •

   to disclose information

5. •

   not to misuse confidential information

Some employees will also owe additional, more onerous duties as a result of their being a fiduciary, or being a fiduciary in respect of some part of their duties. These may include:

1. •

   a duty to act in the best interests of the employer, ie to act selflessly and with undivided loyalty, which in turn comprises:

   1. ◦

      the duty to account for all property and profits made from the employee’s position as a fiduciary (the ‘no profits’ rule)

   2. ◦

      the duty not to let their own interest and that