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Brokers prohibited from performing new roles

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Insurance Business | 17 Oct 2012, 12:06 AM Agree 0
Two insurance brokers have neglected a non-competition clause in their redundancy agreements from former employers OAMPS Insurance Brokers and forced to stop performing their roles at a new brokerage.
  • Robert Cooper | 18 Oct 2012, 12:58 PM Agree 0
    As far as I am concerned, if you retrench staff or sack them all bets are off. Fair enough if you resign to go to a competitor there should be some sort of restriction, but if you get rid of staff,then to me such clauses are grossly unfair. Six months is not unreasonable if you are paid for this period, but expecting them to abide by a further three years is ridiculous and I am sure the Courts would normally see these as unfair. I would appeal if they can afford it.

    Do not forget when you get a job offer, you accept the position and then they give you such a contract to sign, most people do not get a lawyer to vet these and trust their new employer to do the right thing, so a lot of indirect duress occurs.

    Brokers say they cannot get good staff, maybe they are scared off by such onerous clauses.
  • Eniram Ograc | 05 Nov 2012, 11:19 AM Agree 0
    Rob, I understand that these directors had previously sold the Gault Armstrong broking business to OAMPS and were being retained by OAMPS as part of the deal. By letting them set up shop elsewhere the two directors would be able to profit from the earlier sale of the broking business to OAMPS and then be able to try and win the business back while working for the new firm (cake and eat it!). On the flip side, OAMPS should really have done more to secure the client relationships on the business they bought. Don't feel too sorry for them - they aren't exactly account execs earning $80k. One can only wonder what their approach would have been if one of their own staff had left them to open up in competition...
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