Reference no: EM133230136

Daniel is a skilled coffee roaster but needs to employ at least two roasters so that he can develop and operate the business. He is very worried that he will pass on his knowledge and experience to his staff, who may then go and work for a competitor and share the coffee roasting secrets he learned in Italy. He did some online research on how to protect his business from such risks and identified as a potential solution a restraint of trade clause in employee contracts.

Daniel drafted the following clause for the contracts of all coffee roasters based on his internet research:

'Upon the end of this agreement the employee agrees to not work in any capacity for any other coffee roaster in Australia for a period of five years.'

In Part C.2 of your report you must advise Daniel on the following matters:

1. Identify the commercial purpose of a restraint of trade clause.

2. Advise Daniel whether his proposed restraint of trade clause is enforceable.

3. Propose to Daniel a new restraint of trade clause that is likely to meet the requirements of the common law restraint of trade doctrine. In your answer explain how the restraint complies with the requirements of the restraint of trade doctrine.