Are Restraints of Trade Actually Enforceable?

Restraints of trade are one of the most misunderstood clauses in New Zealand employment agreements. Some employees think they are meaningless. Some employers think they are bulletproof. Both assumptions can land you in trouble. In this episode, host Sanam unpacks how restraints actually work in practice and why the Employment Relations Authority (ERA) has moved well past the idea that they are “not worth the paper they’re written on”. Drawing on real world examples and ERA cases, this episode focuses on what genuinely makes a restraint enforceable. You’ll hear why reasonableness is everything, why overreaching is risky, and why evidence matters more than intention. In this episode, Sanam covers: What a restraint of trade is designed to protect under NZ employment law The difference between common restraints like the non-competition and non-solicitation clauses and why it matters The three interests the ERA consistently takes seriously How the ERA assesses reasonableness in relation to time, geography, and scope Practical takeaways for employers drafting restraints  If restraints have ever felt confusing, intimidating, or oddly ignored, this episode will bring you clarity and help you adapt them to your business.  Don't miss our updates and legal insights! Sign up to the Law Lenz Newsletter! CLICK HERE! Follow Sanam on LinkedIn for key employment law updates. Got questions? Send them our way, and Sanam will feature them in the next episode. Email your queries to [email protected]. Check out the Law Lenz website HERE. Resources: Cookright Filtering Services v Hill & Thomas Cookright Filtering Services v Hill & Thomas (Cost Determination) What is a Restraint of Trade in New Zealand? - Legal Vision NZ Non-Solicitation Restraint Clause Example - MBIE Employment Agreement Builder Disclaimer: The content presented in this episode is for informational purposes only and should not be considered as legal advice. The host does not assume any liability for actions taken based on the content of this podcast. While the host is a lawyer, they are not your lawyer and the information provided is based on general legal information. This podcast does not create a solicitor-client relationship.While we strive to keep the information accurate and up-to-date as at the date of each episode, laws and regulations may change, and the content of this podcast may not reflect the most current legal standards or interpretations. Listeners are encouraged to consult with a qualified New Zealand legal professional for advice tailored to their specific situation.