Verint Systems (Australia) Pty Ltd v Sutherland

Verint Systems (Australia) Pty Ltd brought proceedings against its former employee, Sutherland, seeking enforcement of a post-employment non-competition restraint in his employment agreement. Verint, which sells and supports software to businesses for call centre, call recording, workforce management, speech analytics, and automation, placed Sutherland on "garden leave" on 22 May 2019. His employment formally ended on 22 June 2019. Sutherland proposed to commence employment with a named competitor immediately unless restrained. Verint sought an interlocutory injunction to enforce the non-competition restraint. The court needed to decide whether the non-competition restraint was enforceable against Sutherland or if it should be read down under the Restraints of Trade Act 1975.

The court considered the nature of the restraint, the reasonableness of the restraint in the context of the employment, the legitimate interests of the parties, and the balance of convenience. The court found that the restraint was reasonable in scope, duration, and geographical area. Verint's legitimate interest in protecting its confidential information and trade secrets was substantial. Sutherland had not demonstrated that the restraint was unreasonable or that there was no serious question to be tried. The court also considered that the balance of convenience favoured enforcing the restraint. Verint had offered undertakings as to damages, and Sutherland had offered non-solicitation and confidentiality undertakings.

Accordingly, the court granted an interlocutory injunction to restrain Sutherland from working for the named competitor for a period of 12 months from the date of his termination of employment. The court also ordered that Verint accelerate the payment of post-employment bonuses to Sutherland. The court noted that the final hearing would determine the enforceability of the restraint and any appropriate modifications. The court's decision provided Verint with immediate protection against Sutherland working for a competitor, while also providing Sutherland with some relief in the form of accelerated payment of bonuses.