Employsure Pty Ltd v McMurchy [2021] NSWSC 139

Employsure Pty Ltd v McMurchy [2021] NSWSC 139

Employsure was entitled to an interlocutory injunction restraining Mr McMurchy from commencing employment with ELMO until 14 March 2021 under clause 18.2 of the 2018 employment contract. The Court found it strongly arguable that the contractual notice period was three months and that the restraints applied during the period of 'gardening leave', regardless of whether the employee was actively working. The contractual variation referencing the earlier contract was likely an error. Balance of convenience was in Employsure's favour given continued salary payment to Mr McMurchy during the notice period.

Jurisdiction
Australia
Judgment Date
24 February 2021
Procedural Posture
Interlocutory Application / Interlocutory Hearing and Orders
Outcome
Interlocutory injunction granted in part
Legal Topics
['restraint of Trade' 'interlocutory Injunctions' 'termination of Employment' 'construction of Contracts' 'notice Period for Termination']
['employment Law' 'equity'] ['restraint of Trade' 'interlocutory Injunctions' 'termination of Employment' 'construction of Contracts' 'notice Period for Termination']

Case Brief

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Procedural Posture

Interlocutory Application / Interlocutory Hearing and Orders

Legal Issues

  1. 1 ['Whether the employee was still employed by the applicant after purported resignation on less notice than contractually required' 'The construction and effect of written variations to the employment contract referencing an earlier contract with a shorter notice period' 'Whether contractual restraint of trade applies during notice/gardening leave period when no active work is performed' 'Whether the applicant is entitled to an interlocutory restraint preventing the employee from commencing new employment' 'Duration of notice period and effect of an incorrect notice by the employee' 'Whether injunctive relief amounts to specific performance and is appropriate']

Ratio Decidendi

Employsure was entitled to an interlocutory injunction restraining Mr McMurchy from commencing employment with ELMO until 14 March 2021 under clause 18.2 of the 2018 employment contract. The Court found it strongly arguable that the contractual notice period was three months and that the restraints applied during the period of 'gardening leave', regardless of whether the employee was actively working. The contractual variation referencing the earlier contract was likely an error. Balance of convenience was in Employsure's favour given continued salary payment to Mr McMurchy during the notice period.

Court Disposition

Interlocutory injunction granted in part

Orders

  • ['Until 14 March 2021 or further order, the first defendant (David McMurchy) is restrained from performing any work or duties for, or at the direction of, the second defendant (ELMO Software Limited), and from attending any workplace under the control of the second defendant.' 'Note the undertaking given as recorded...