In recent years, contracts of employment especially for professional services executed between employers and employees in Ghana contain some provisions on restraint of trade. Restraint of Trade Agreements or Clauses (RTAs) are provisions in contracts that restrict the activities of one party after the termination of a business relationship, typically an employment agreement or a business sale/transaction. RTAs may take the form of non-competition clauses, non-solicitation clauses, non-disclosure/confidentiality clauses and non-interference clauses among others.
These clauses aim to protect the legitimate interests of the party imposing the restriction, usually by preventing the other party from engaging in certain competitive activities within a specific time period or geographic area. RTAs seek to protect the legitimate interest of employers by preventing the employees from taking advantage of trade secrets, business information, and clientele among others. RTAs are usually targeted at preventing employees from unfairly competing with their employers after the employment relationship has been severed.
Generally, RTAs are seen as restrictions on an employee’s right to work since they limit the scope of work the employee can engage in usually for a specific period after the severance of the employment relationship.
This piece thus seeks to answer three questions. The first question is whether RTAs are valid and enforceable in Ghana. The second question is to what extent will the courts in Ghana enforce RTAs? The third question is what are the remedies available if any for the breach of RTAs in Ghana?
