Phil joins Sky-High Designs as a designer. He signs an employment agreement that says he will not engage in design work in the c
ity for six months after termination of his employment with the firm. Phil works with the firm for two years and then resigns to immediately join as a designer in another firm in the same city. Sky-High Designs sues him for breach of contract, and is likely to:
lose because employee contracts that restrict trade are illegal
Explanation:
The above case relates to the restraint of trade. Export limitations are a concept in customary law referring to the constitutionality in commercial limits on the right to do commerce. This is a forerunner to the current rule to competition.
A statutory commitment not to exchange is null and unenforceable towards the Promiser as opposed to the national policy of encouraging commerce, although the restriction of exchange is fair to preserve the rights of a trade buyer. Trade restrictions may also manifest as binding covenants in work arrangements throughout post-termination.
