{"id":305,"date":"2026-03-08T19:09:09","date_gmt":"2026-03-08T19:09:09","guid":{"rendered":"https:\/\/cjhlaw.co.za\/wp\/?p=305"},"modified":"2026-03-08T19:11:05","modified_gmt":"2026-03-08T19:11:05","slug":"enforceability-of-a-restraint-of-trade-clause-after-dismissal","status":"publish","type":"post","link":"https:\/\/cjhlaw.co.za\/wp\/2026\/03\/08\/enforceability-of-a-restraint-of-trade-clause-after-dismissal\/","title":{"rendered":"Enforceability of a Restraint of Trade Clause after Dismissal"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">A restraint of trade clause is a contractual provision that restricts an employee from competing with their former employer or soliciting its clients and staff after leaving employment. Its purpose is to protect the employer\u2019s proprietary interests \u2014 such as confidential information, trade secrets, customer connections, goodwill, and the stability of its workforce.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Requirements for Enforceability<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The courts have consistently held that restraints are prima facie enforceable, unless shown to be unreasonable or contrary to public policy. The key requirements are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Protectable interest: The employer must demonstrate a legitimate interest (confidential information, trade connections, goodwill, employee stability).<\/li>\n\n\n\n<li>Reasonableness: The restraint must be reasonable in scope, duration, and geography.<\/li>\n\n\n\n<li>Public policy balance: Courts weigh the employer\u2019s right to protect its business against the employee\u2019s constitutional right to work.<\/li>\n\n\n\n<li>Termination context: The restraint applies regardless of how employment ends, unless dismissal was fraudulent or in bad faith.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the matter of <em>Backsports (Pty) Ltd v Motlhanke<\/em>, the Labour Appeal Court overturned the Labour Court\u2019s refusal to enforce a restraint against a dismissed employee. The appellant, Backsports, employed Mr Motlhanke as a Senior Stream Lead. His contract contained a 12\u2011month restraint clause prohibiting competition, solicitation of clients (including SuperSport Schools, Central Gauteng Athletics, and Oban Productions), and solicitation of employees.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">After his dismissal for misconduct, Motlhanke was found to have:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Approached Backsports\u2019 customers for streaming work.<\/li>\n\n\n\n<li>Collaborated with former colleagues to deliver services to Central Gauteng Athletics.<\/li>\n\n\n\n<li>Made alleged threats against employees and assets, including sabotage of broadcasting equipment.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Labour Court initially held that dismissal disentitled the employer from enforcing the restraint, reasoning that it would be unjust to prevent a dismissed employee from earning a livelihood. The Labour Appeal Court disagreed, citing <em>Reeves v Marfield Insurance Brokers<\/em> which held that restraints apply \u201cfor any reason whatsoever\u201d upon termination, unless dismissal was fraudulent or in bad faith.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>\u201cIn essence, on the authority of Reeves, the restraint of trade agreement is enforceable despite the circumstances that led to the termination of the employment contract.\u201d<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Significance of Backsports (Pty) Ltd v Motlhanke<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This case is significant for several reasons:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2022 &nbsp;&nbsp; Dismissal does not negate restraint: The Court confirmed that dismissal \u2014 even for misconduct \u2014 does not waive the employer\u2019s right to enforce a restraint. This aligns with Reeves and strengthens employers\u2019 ability to protect their interests post\u2011employment.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2022 &nbsp;&nbsp; Protectable interests clarified: The Court emphasised that goodwill, customer relationships, and employee stability are legitimate proprietary interests. Even without confidential information, approaching customers and soliciting staff constituted a breach.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2022 &nbsp;&nbsp; Ancillary jurisdiction affirmed: The Court held that the Labour Court had jurisdiction to consider related interdicts (such as threats to employees and assets) under section 77(3) of the BCEA and section 158(1)(j) of the LRA. This prevents fragmented litigation and ensures effective remedies.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u2022 &nbsp;&nbsp; Balancing interests: The judgment reinforces the Basson v Chilwan test, requiring courts to balance the employer\u2019s protectable interests against the employee\u2019s right to work. Here, the employee\u2019s short tenure did not outweigh the employer\u2019s need to protect its customer base and workforce.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Practical Implications<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>For employers: Draft restraint clauses carefully, ensuring they are reasonable in duration and scope. Document proprietary interests (clients, goodwill, employees) to support enforcement.<\/li>\n\n\n\n<li>For employees: Understand that dismissal does not release you from restraint obligations. Breaching restraints can lead to costly interdicts and damages.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Backsports judgment strengthens the enforceability of restraint of trade clauses in South African employment law. It confirms that dismissal does not nullify restraints, highlights the breadth of protectable interests, and affirms the Labour Court\u2019s jurisdiction over ancillary interdicts. For employers, it is a reminder to draft robust contracts; for employees, a caution that post\u2011employment obligations remain binding.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>The information provided in this article does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available in this article are for general informational purposes only. Readers of this article should contact us or any other attorney to obtain advice with respect to any particular legal matter.&nbsp; No reader, user, or browser of this article should act or refrain from acting on the basis of information on this article without first seeking legal advice.&nbsp; Only your individual attorney can provide assurances that the information contained herein \u2013 and your interpretation of it \u2013 is applicable or appropriate to your particular situation.&nbsp; All liability with respect to actions taken or not taken based on the contents of this article are hereby expressly disclaimed.&nbsp; The content on this posting is provided &#8220;as is;&#8221; no representations are made that the content is error-free.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A restraint of trade clause is a contractual provision that restricts an employee from competing with their former employer or soliciting its clients and staff after leaving employment. Its purpose is to protect the employer\u2019s proprietary interests \u2014 such as confidential information, trade secrets, customer connections, goodwill, and the stability of its workforce. Requirements for [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":308,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"pagelayer_contact_templates":[],"_pagelayer_content":"","footnotes":""},"categories":[18,171],"tags":[193,188,192,191,190,186,187,189],"class_list":["post-305","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-labour-law","category-law-of-contract","tag-backsports-pty-ltd-v-motlhanke","tag-competing-with-former-employer","tag-dismissal-for-misconduct","tag-employers-right","tag-protectable-interest","tag-restraint-of-trade","tag-restraint-of-trade-clause-after-dismissal","tag-soliciting-clients"],"_links":{"self":[{"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/posts\/305","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/comments?post=305"}],"version-history":[{"count":2,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/posts\/305\/revisions"}],"predecessor-version":[{"id":311,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/posts\/305\/revisions\/311"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/media\/308"}],"wp:attachment":[{"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/media?parent=305"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/categories?post=305"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cjhlaw.co.za\/wp\/wp-json\/wp\/v2\/tags?post=305"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}