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Law

A Restraint of Trade and a Non-Solicitation Clause Are Not the Same Thing

A restraint of trade prevents a former employee from working for a competitor or starting a competing business at all, while a non-solicitation clause is narrower — it permits working in the same industry but prohibits actively poaching the former employer's clients or staff.

For employees signing contracts, this distinction shapes what career moves are actually available — a non-solicitation clause leaves far more room to work in the same field. For employers, drafting the narrower, more targeted clause where appropriate often makes it more enforceable than an overly broad restraint a judge may strike down.

Source: Supreme Court of Appeal

Frequently Asked Questions

Can I work for a direct competitor if I only signed a non-solicitation clause?

Generally yes — a non-solicitation clause restricts poaching clients or staff, not employment with a competitor itself, unlike a full restraint of trade.

Are restraint of trade clauses automatically enforceable in South Africa?

They are presumptively valid, but courts will refuse to enforce them if unreasonable or if they don't protect a legitimate business interest — the employee carries the burden of proving this.

What counts as a "legitimate interest" that justifies a restraint?

Typically confidential information, trade secrets, or established customer relationships — a restraint with no such protectable interest behind it is more likely to be struck down.

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