Restrictive Covenants - Detailed Analysis

Last Updated: October 2022

(c) Termination of Employment Contract Other than through a Wrongful Dismissal

A British Columbia court soundly rejected the proposition put forward by several employees who had departed voluntarily to join a competitor that the plaintiff could not rely on the restrictive covenants set out in their employment agreements on the basis that they did not survive their employment: “Were it the law that upon termination of employment no obligations under the contract of employment survived, there would be no possibility of ever enforcing non-competition or non-solicitation clauses that are intended to govern the immediate post-employment period.”1

  1. Yellow Pages Group v. Anderson, 2006 BCSC 518 (CanLII), at para. 34. While this statement of the law is undoubtedly sound, the case relied on by the court, Raymond Salons Ltd. v. Boucher, 1990 CanLII 1763 (BCSC), is not, it is submitted, good law in Canada. There, the court held that a covenant survived a wrongful dismissal. This decision and proposition was rejected by the Alberta Court of Appeal in Globex Foreign Exchange Corporation v. Kelcher, 2011 ABCA 240 (CanLII), at paras. 44-58.