Jobnet Worldwide Pty Limited v Elisabeth Lange

Jobnet Worldwide Pty Limited (the applicant) sought to enforce an employment restraint of trade clause against its former employee, Elisabeth Lange (the respondent). The dispute concerned the validity and enforceability of a restraint of trade clause contained within Ms Lange's employment contract, which Jobnet argued prevented her from working for a competitor within a specified geographical area and for a defined period after her employment ceased.

The primary legal issue before the court was whether the restraint of trade clause was reasonable and therefore enforceable. This required the court to consider the scope of the restraint, including its duration, geographical reach, and the nature of the activities it sought to prevent, in light of the legitimate business interests of Jobnet that required protection. The court also had to determine if the restraint went beyond what was necessary to protect those interests, thereby constituting an unreasonable restriction on Ms Lange's ability to earn a living.

In reaching its decision, the court applied the established legal principles governing restraints of trade, which are presumed to be void as contrary to public policy unless they can be shown to be reasonable. Reasonableness is assessed by balancing the employer's need to protect its proprietary interests (such as trade secrets, confidential information, and customer connections) against the employee's right to work in their chosen field. The court found that the restraint, as drafted, was overly broad in its geographical scope and duration, and therefore went further than necessary to protect Jobnet's legitimate business interests. Consequently, the court held the restraint to be unreasonable and unenforceable.