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Employment Contract for Accountant

Employment contract for an accountant which prevents them taking clients

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Can anyone recomend a good HR site or company that can provide a decent employment contract for an accountant which will prevent them taking clients if they leave.

 

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By Slim
26th Jan 2020 22:23

Thought it wasnt worth the paper it is written on?

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By Tim Vane
26th Jan 2020 23:34

Aint no such animal. Not really.

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By frankfx
27th Jan 2020 08:07

Have a word with ACAS to scope the parameters.

Have a conversation with a solicitor, who may be an employee of their firm (!) and subject to a strongly worded contract, to see how such a contract would work in practice.

have a look at this article

https://smallbusiness.co.uk/stealing-clients-how-to-stop-employees-poach...

It may be the starting point of a conversation with a lawyer, and more importantly with your employee.

I wonder how other AWEBers have addressed the situation you have outlined, resigned acceptance may be the consensus.

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By paul.benny
27th Jan 2020 08:11

AFAIK, employment contracts that purport to prevent former employees from working for a competitor (or setting up as a competitor) have been held to be largely unenforceable.

Do you actually mean non-solicitation - that is, not approaching your clients?
Even that would have to be time-limited and only applicable to senior roles.

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Hallerud at Easter
By DJKL
27th Jan 2020 09:57

The catch is not getting something into a contract, that is reasonably simple, the issues are:

1. Ensuring any restrictive covenant is not too wide- decent solicitor can advise. (remember Bluebell Apparel ltd v Dickinson)

2. Being realistic re cost/benefit analysis if employee were to break agreement; what would you actually do, would you be prepared to go to court, what would be the costs and your likely financial recovery if you won (especially as you virtually certainly would not regain the client in such a scenario)

I have a restrictive covenant but only regarding other work I may do at the same time as my current employment (whilst I was also in practice I could not have taken on an Edinburgh property developer as a client as might have been a conflict of interest) but frankly as you are looking to protect your clients from poaching in reality you best protection is ensuring you keep contact with the clients, do not leave all contact to your staff.

The veneer of protection of a restrictive covenant is imho thin anyway, if I work for you, leave your employment, go work for A N Other firm, and clients follow the member of staff to such a firm (but he/she is not an owner, merely an employee), how are you getting a restriction to bite, the other firm has signed nothing with you?

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By David Gordon FCCA
28th Jan 2020 11:41

Am I living in a parallel world?
Such contracts have been standard practice for decades.
And, there has been been case law regarding the enforcement thereof.

I subscribe to Indicator Ltd -"Safe Employment Documents" I find their stuff well written and an easy read. The drafted examples are well laid out and effective.

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Replying to David Gordon FCCA:
Hallerud at Easter
By DJKL
28th Jan 2020 11:57

No, but with all legal documents they are only as good as the depth of the pockets of the party being pursued and how much the pursuer is willing to risk- so large organisations and firms, fine, smaller beasties, implementing may be pointless.

For instance these days we would not bother executing a registered lease for an annual rent below £20k-£25k pa, experience has taught that the extra expenditure having a solicitor executing an all singing all dancing lease is generally a waste of time, if our tenants bail out on us then chasing legal recovery is usually just good money after bad.

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@enanen
By enanen
29th Jan 2020 10:57

The suggestion is that you own clients when in fact you do not. In practical terms it is about relationships. If the person you are going to engage is going to be in a relationship role it is difficult. The client will see their accountant as the person they speak to the most. The firm name is secondary. Contracts and pieces of paper have limited merit. The other issue is what do you intend to spend legally if after several years looking after clients he leaves and they decide to go to his new firm. The art is staying close to the clients he looks after and be in constant contact as the go to person for them. If you 'sub-contract' your clients work to your new staff member, you will sub-contract the relationship and risk losing it at some point unless you stay at the centre of your client relationships.

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Replying to enanen:
Hallerud at Easter
By DJKL
29th Jan 2020 12:27

Agreed- to corrupt a well known quotation, "keep your staff close but the clients they act for closer."

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By David Gordon FCCA
29th Jan 2020 12:09

Actually it is more important for small firms.
As I remember it professional ethics comes into play.
I believe ACCA and or ICAEW have stuff and guidance on this.

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By frankfx
29th Jan 2020 12:44

Businesses with deeper pockets wishing to retain client place departing worker on gardening leave.

While new incumbent nurtures s fresh fruitful relationship.

For lesser businesses deep pockets tend to be used to keep hands warm or hold loose change or digital equivalent.

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