Non-solicitation clauses in Australian employment contracts attempt to prevent departing employees from taking clients, customers, or colleagues to a new employer. They're common — particularly in professional services, sales, and senior management roles — but their enforceability is not guaranteed. Australian courts apply a reasonableness test, and an overbroad clause may be invalid or modified by a court. Understanding what you're agreeing to before you sign is essential.
What is a Non-Solicitation?
A non-solicitation clause typically prohibits a departing employee from: (1) soliciting former clients or customers to move their business; (2) soliciting former colleagues to join their new employer; or (3) dealing with former clients, even if approached by the client themselves. These clauses are distinct from non-compete clauses (which prevent working for a competitor) but often appear alongside them. Australian courts distinguish between protecting legitimate business interests (client relationships built at the employer's expense) and imposing an unreasonable restraint on trade.
Red flags to watch for
Courts are more likely to enforce restraints on soliciting clients you had a direct relationship with, rather than all of the business's clients. A company-wide client restraint is overbroad for most roles.
Australian courts assess reasonableness based on seniority and the nature of the client relationships. Restrictions longer than 6-12 months are increasingly difficult to justify for most employees.
Many Australian employment contracts include cascading clauses to survive partial unenforceability. While courts can enforce the reasonable tier, a contract with cascading clauses is often a sign that the employer knows the full restraint is overbroad.
Non-dealing provisions — which prohibit any business relationship with former clients even without solicitation — are broader than non-solicitation clauses and less likely to be upheld unless clearly tied to a legitimate business interest.
If the non-solicitation clause is introduced mid-employment without new consideration (a raise, promotion, or genuine access to confidential information), its enforceability may be challenged.
Your legal rights
Restraint of trade clauses in Australia are governed by the general law of contract and, in NSW, the Restraints of Trade Act 1976 (which explicitly allows courts to modify, rather than void, unreasonable restraints). Courts will enforce restraints that are reasonable in scope, duration, and geographic area, and that protect a legitimate business interest (trade secrets, customer connections built at the employer's expense, or significant training investment). If a restraint is found to be unreasonable, a court can either void it entirely (in states other than NSW) or read it down to a reasonable scope.
Questions to ask before you sign
- 1Does the non-solicitation clause cover only clients I directly worked with, or all of the company's clients?
- 2How long does the restriction last, and is that proportionate to my seniority and the nature of my client relationships?
- 3Does the clause prohibit active solicitation only, or also passive dealing (taking a call from a former client)?
- 4Are there cascading or ladder clauses, and which tier is most likely to be enforced?
- 5What consideration am I receiving for agreeing to this restraint?
Disclaimer: This guide is for educational purposes only and does not constitute legal advice. Contract law varies by jurisdiction and individual circumstances. Always consult a qualified legal professional before making decisions based on this information.