High Court Decision: Tom James UK Ltd v Potter

On 4 November 2025, the High Court (King’s Bench Division) handed down judgment in Tom James UK Ltd v Potter [2025] EWHC 2873 (KB).

The case concerned a tailoring company’s attempt to enforce a 12‑month non‑competition clause against a salesperson who had resigned after eight years of service.

The employer alleged that the former employee intended to compete and sought to rely on wide-ranging restrictive covenants introduced in a 2022 contract. These covenants doubled the duration of the non‑compete period from six to twelve months and removed earlier limitations on geography and role. The Court dismissed the claim, finding:

• The employee had not breached duties of fidelity, confidentiality, or good faith.
• The restrictive covenant went further than reasonably necessary to protect legitimate business interests.
• The clause was unenforceable, even after severing vague wording such as “or intends to be.”

Why the Case Matters

This decision highlights several important principles for employers:

• Restrictive covenants must be reasonable: Courts will only uphold restraints that are no more than necessary to protect legitimate business interests, such as confidential information or customer connections.
• One-size-fits-all drafting is risky: The employer applied the same 12‑month non‑compete clause to all sales staff, regardless of seniority. The Court noted that the defendant was a mid‑ranking salesperson with no leadership role or access to strategic information. Applying such broad restrictions to him was disproportionate.
• Notice periods matter: The employee’s notice period was just one month. Imposing a 12‑month non‑compete was out of proportion to the contractual framework.
• Customer relationships can be protected by narrower clauses: Non‑solicitation and non‑dealing provisions are often sufficient. Attempting to restrain pure competition, particularly where the employee’s role is limited, will not succeed.

 Practical Guidance for Employers

This case serves as a reminder that post‑termination restrictions should be carefully drafted and applied selectively:

• Appropriate for key employees: Senior executives, directors, or staff with access to strategic confidential information may justify longer and broader restrictions.
• Not appropriate for junior or mid‑ranking staff: Employees whose roles are limited to sales or operational tasks, without access to sensitive business strategy, should not be subject to sweeping non‑compete clauses.
• Tailor the scope: Restrictions should be limited by geography, role, and duration. Overly broad clauses risk being struck down entirely.
• Document the rationale: Employers should record why a restriction is necessary at the time of drafting, to demonstrate proportionality if challenged.

Conclusion

The High Court’s ruling in Tom James UK Ltd v Potter is a clear warning: employers cannot rely on blanket non‑compete clauses for all staff. Restrictive covenants must be proportionate, targeted, and reserved for those in positions where genuine business interests are at risk. For HR teams and legal advisers, this decision reinforces the importance of bespoke drafting and careful consideration of who restrictions should apply to.

This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our Employment team at Cleaver Fulton Rankin for further advice. 

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