{ "type": "practice-guide", "canonical": "https://openagreements.org/practice-guides/non-compete/au/tasmania", "links": [ { "rel": "self", "href": "https://openagreements.org/practice-guides/non-compete/au/tasmania.json", "type": "application/json" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/tasmania", "type": "text/html" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/tasmania/markdown", "type": "text/markdown" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/tasmania/json", "type": "application/json" } ], "data": { "topic": "non-compete", "state": "tasmania", "frontmatter": { "title": "Non-Compete Enforceability in Tasmania", "description": "In Tasmania a post-employment non-compete is presumptively void as a restraint of trade and binds a former employee only so far as it is reasonable; Tasmania has no statutory read-down power, so a court can sever covenants the parties themselves drafted as separate but cannot rewrite an overbroad clause, and a clause that severance cannot save fails entirely.", "state": "Tasmania, Australia", "country_code": "AU", "lastReviewed": "2026-06-10", "license": "CC BY 4.0", "authors": [ "steven-obiajulu" ], "summary": { "enforceability": "reasonable", "bottomLine": "A Tasmanian non-compete is presumptively void and binds a former employee only so far as it is reasonable to protect a legitimate interest; there is no statutory read-down power, so a court can only sever covenants the parties themselves drafted as genuinely separate, and an overbroad clause that severance cannot save fails entirely.", "keyLaw": "Common-law restraint of trade (no equivalent of the NSW Restraints of Trade Act 1976)", "exceptions": "Sale-of-business covenants are judged more leniently; a proposed federal ban would, if enacted, cover most employees earning under the Fair Work Act high-income threshold (with sale-of-business and above-threshold restraints reported to be excluded), but it is not yet law.", "courtNarrowing": "trimOnly", "appliesToContractors": "yes", "extendedForBreach": "Untested; Australian courts treat rolling or indefinite restraints with suspicion and generally prefer damages over extending an injunction.", "maxLength": "No statutory cap; reasonableness is judged case by case — a one-month, 50-kilometre covenant was treated as reasonable in Bulk Frozen Foods v Excell, while a three-year restraint survived only for the purchased client connection in Neville Jeffress Advertising v Barlow (No 2).", "noticeRequirement": "None", "saleOfBusiness": "Sale covenants judged less strictly than employee restraints", "customerNonSolicit": "Restraint-of-trade reasonableness; protects a genuine customer connection, severable" }, "about": [ "Tasmania non-compete agreements", "Tasmania restraint of trade clauses", "Tasmania severance restraint of trade", "cascading restraint clause Tasmania", "Tasmania no statutory read-down restraint of trade", "Bulk Frozen Foods v Excell cascading covenants", "Neville Jeffress Advertising v Barlow severance", "Lindner v Murdock's Garage reasonableness", "Tasmania garden leave non-compete", "Australia proposed non-compete ban" ], "eyebrow": "Tasmania · Australia Law Practice Guide" }, "questions": [ { "slug": "enforceability", "label": "Are non-competes enforceable?", "heading": "Are employee non-competes enforceable in Tasmania?", "answerText": "Only so far as they are reasonable. A post-employment non-compete is treated as a restraint of trade, which the common law presumes is unenforceable unless the employer shows it goes no further than is reasonably necessary to protect a legitimate business interest. The Supreme Court of Tasmania has stated the test in orthodox terms: to be reasonable, a covenant must afford no more than adequate protection to the party in whose favour it is imposed, judged at the time the covenant was entered into. The onus of justifying the restraint sits on the employer.", "sources": [ { "id": "jeffress-adequate-protection", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J), citing Herbert Morris Ltd v Saxelby [1916] 1 AC 688 and Lindner v Murdock's Garage (1950) 83 CLR 628.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "To be reasonable, a restraint must afford no more than adequate protection to the party in whose favour it is imposed, judged at the time the covenant was entered into.", "verbatimQuote": "In considering the primary question as to whether or not the covenant is reasonable as between the parties, two propositions are fundamental, namely that in order to be regarded as reasonable the covenant must afford no more than adequate protection to the party in whose favour it is imposed (Herbert Morris Ltd v Saxelby (supra) at 707) as judged at the time the covenant was entered into (Lindner v Murdock's Garage [1950] HCA 48 ; (1950) 83 CLR 628 at 653; Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40 ; (1973) 133 CLR 288 at 318).", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-adequate-protection" }, { "id": "lindner-onus", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per McTiernan J).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "The employer bears the onus of proving circumstances showing the restriction on the employee's freedom to work is reasonable.", "verbatimQuote": "The onus was on the plaintiff firm to prove circumstances showing that the restriction on the defendant's freedom to work was reasonable.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-onus" }, { "id": "jeffress-public-welfare", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J), quoting Buckley v Tutty (1971) 125 CLR 353.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "Unreasonable restraints are unenforceable because it is contrary to the public welfare that a person be unreasonably prevented from earning a living and that the public be deprived of that person's services.", "verbatimQuote": "The law treats unreasonable restraints as unenforceable because it is contrary to the public welfare that a man should unreasonably be prevented from earning his living in whatever lawful way he chooses and that the public should unreasonably be deprived of the services of a man prepared to engage in employment.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-public-welfare" } ] }, { "slug": "court-narrowing", "label": "Can a court narrow an overbroad clause?", "heading": "Can a Tasmanian court narrow an overbroad non-compete?", "answerText": "Only in a limited way, and far less generously than many employers assume. Tasmania has no statute that lets a court read an overbroad restraint down to a reasonable level. What a court can do is sever — that is, delete — covenants that the parties themselves drafted as genuinely separate, where what is covenanted is substantially equivalent to a number of separate covenants. It cannot read down, add to, or rewrite the clause. In the leading Tasmanian decision, the court held a multi-part covenant valid only for one of its severable parts and invalid for the rest.", "sources": [ { "id": "jeffress-blue-pencil", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "The blue-pencil label is misleading; severance is possible where the covenant is expressed in terms amounting to a clear severance by the parties themselves, so that what is covenanted is substantially equivalent to a number of separate covenants.", "verbatimQuote": "The \"blue pencil test\" is misleading. Where a covenant is expressed in terms which amount to a clear severance by the parties themselves, so that what is covenanted substantially is equivalent to a number of separate covenants, severance is possible (S V Nevanas and Co v Walker (1914) 1 Ch 413 at 423; Attwood v Lamont (1920) 3 KB 571 at 578).", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-blue-pencil" }, { "id": "jeffress-no-toto", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "An overbroad covenant does not necessarily fail in its entirety; where it contains separate severable covenants, the unreasonable ones can be cut away and the reasonable ones enforced.", "verbatimQuote": "It does not follow that the covenant fails in toto. The six separate provisions contained within the covenant which earlier I have identified each is a separate severable covenant.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-no-toto" }, { "id": "jeffress-clients-only", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "After severance, the covenant was held valid only insofar as it protected the purchased client connection, and invalid as to the wider categories of clients.", "verbatimQuote": "I hold that severance is possible. Insofar as the Clients are concerned, but not otherwise, the covenant is valid in respect of the period of three years from the date of the termination of the employment of the defendant.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-clients-only" } ] }, { "slug": "cascading-clauses", "label": "Are cascading or ladder clauses valid?", "heading": "Are cascading or ladder restraint clauses valid in Tasmania?", "answerText": "Yes, within limits — and the leading Tasmanian decision tested the device at an extreme. In Bulk Frozen Foods Pty Ltd v Excell, the restraint combined seven capacities, fifteen activities, thirteen areas, and six periods, each combination expressed as an independent severable covenant, producing 8,190 separate covenants. Blow CJ held the clause was not void for uncertainty, treating it as a genuine attempt to define the employer's need for protection rather than an exercise in leaving the court to make the parties' contract for them.", "sources": [ { "id": "bulk-8190", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), recording a submission of senior counsel for the defendant.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "A cascading restraint combining seven capacities, fifteen activities, thirteen areas, and six periods produced 8,190 separate covenants, each expressed as an independent severable restraint.", "verbatimQuote": "The result, as pointed out by senior counsel for the defendant, is that the parties entered into not one covenant, but 8,190 separate covenants. That figure is calculated by multiplying together the number of specified capacities (7), the number of specified businesses or activities (15), the number of specified areas (13), and the number of periods (6): 7 x 15 x 13 x 6 = 8,190.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-8190" }, { "id": "bulk-genuine-attempt", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), quoting Spender J in Lloyd's Ships Holdings Pty Ltd v Davros Pty Ltd (1987) 17 FCR 505.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "Despite the very large number of combinations, the clause was regarded as a genuine attempt to define the covenantee's need for protection, with severance agreed as a precaution against the all-or-nothing nature of the reasonableness tests.", "verbatimQuote": "Although the result is a very large number of combinations, I think the clause should be regarded as, in the words of Spender J, \"a genuine attempt to define the covenantee's need for protection, with the agreement as to severance as a precaution against the 'all or nothing' nature of the court's tests for reasonableness\".", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-genuine-attempt" }, { "id": "bulk-cascade-structure", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "The contract cascaded both time and area: the schedule provided a cascading series of time restraints, and the area limb split Tasmania into telephone districts with fall-back radii around five post offices.", "verbatimQuote": "Because of that willingness, Item 8 in the schedule to the contract made provision for a cascading series of time restraints. And cl 8.2(b)(C) split Tasmania into three telephone districts, added fall-back provisions relating to areas within 100 kilometres of five different post offices, and added further fall-back provisions relating to areas within 50 kilometres of the same five post offices.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-cascade-structure" }, { "id": "bulk-any-one-reasonable", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "Because each combination was an independent severable covenant, the clause was not void if any one of the 8,190 covenants was reasonable.", "verbatimQuote": "It followed that cl 8.2(b) is not void if any one of the 8,190 severable covenants was reasonable.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-any-one-reasonable" }, { "id": "bulk-outcome", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "On the preliminary issue, the clause was determined to be not void for uncertainty and not wholly void for unreasonableness, with the question whether some of the individual covenants were too wide expressly left open.", "verbatimQuote": "On 30 October 2014 I determined that the clause was not void for uncertainty, and was not wholly void for unreasonableness. I left open the question whether some of the covenants embodied in that clause were void for unreasonableness.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-outcome" } ] }, { "slug": "legitimate-interest", "label": "What interest must an employer protect?", "heading": "What legitimate interest must an employer show to enforce a Tasmanian non-compete?", "answerText": "A protectable business interest — not a mere wish to avoid competition. An employer cannot restrain a former employee simply because a rival might benefit; an employer must be prepared to face the competition of a former employee if it comes. The Supreme Court of Tasmania has put the requirement in property terms: a restraint of trade is only valid if the covenantee has some property or interest that can be protected, such as confidential information or trade secrets.", "sources": [ { "id": "lindner-face-competition", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per McTiernan J).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "An employer has no protectable interest in freedom from competition by a former employee as such and must be prepared to face that competition; only a recognised interest can support a restraint.", "verbatimQuote": "An employer must be prepared to face the competition of a former employee if it comes.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-face-competition" }, { "id": "bulk-property-interest", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), citing Bacchus Marsh Concentrated Milk Co Ltd v Joseph Nathan & Co Ltd (1919) 26 CLR 410.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "A restraint of trade is only valid if the covenantee has some property or interest that can be protected, such as confidential information or trade secrets.", "verbatimQuote": "A restraint of trade will only be valid if the covenantee has some property or interest that can be protected, such as confidential information or trade secrets: Bacchus Marsh Concentrated Milk Co Ltd v Joseph Nathan & Co Ltd [1919] HCA 18 ; (1919) 26 CLR 410 at 440-441; KA & C Smith Pty Ltd v Ward (1998) 45 NSWLR 702 at 723.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-property-interest" }, { "id": "bulk-confidential-satisfied", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "On the evidence of customer, pricing, and margin information routinely supplied to the manager, the employer had confidential information that could reasonably be protected by a restraint of trade in an employment contract.", "verbatimQuote": "I was satisfied that the plaintiff had confidential information that could reasonably be protected by a restraint of trade provision in a contract of employment.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-confidential-satisfied" }, { "id": "bulk-skill-not-property", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), citing Herbert Morris Ltd v Saxelby [1916] 1 AC 688.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "The general skill and knowledge a person acquires in their work does not amount to property and will not be protected by a restraint.", "verbatimQuote": "The general skill and knowledge that a person acquires in his or her work does not amount to property and will not be protected: Herbert Morris Ltd v Saxelby [1916] 1 AC 688 at 711; Bacchus Marsh Concentrated Milk Co Ltd v Joseph Nathan & Co Ltd (above) at 441.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-skill-not-property" }, { "id": "jeffress-skill-experience", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J), quoting Stenhouse Australia Ltd v Phillips [1974] AC 391.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "An employer is not entitled to protection from mere competition; the former employee may use personal skill and experience to the full, and the employer's claim must rest on an advantage or asset inherent in the business that is in a general sense its property.", "verbatimQuote": "The accepted proposition that an employer is not entitled to protection from mere competition by a former employee means that the employee is entitled to use to the full any personal skill or experience even if this has been acquired in the service of his employer: it is this freedom to use to the full a man's improving ability and talents which lies at the root of the policy of the law regarding this type of restraint.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-skill-experience" } ] }, { "slug": "reasonableness-factors", "label": "How long and how wide can it be?", "heading": "How long and how wide can a Tasmanian non-compete be?", "answerText": "There is no statutory limit; reasonableness is decided case by case on the activity restrained, the geographic area, the duration, and the employee's seniority and access to protectable information. Reasonableness is judged by reference to the circumstances at the time of the contract, not by hindsight. A geographic area wider than the employer's business reasonably requires is likely to be fatal.", "sources": [ { "id": "bulk-tested-at-contract", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), citing Lindner v Murdock's Garage (1950) 83 CLR 628.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "The reasonableness of a restraint of trade is judged by reference to the circumstances at the time of the contract, not with hindsight.", "verbatimQuote": "The reasonableness or otherwise of a restraint of trade must be judged by reference to the circumstances at the time of the contract: Lindner v Murdock's Garage [1950] HCA 48 ; (1950) 83 CLR 628 at 653.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-tested-at-contract" }, { "id": "lindner-area-too-wide", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per McTiernan J).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "A restraint whose geographic area is wider than reasonably necessary to protect the employer's business is unreasonable and void; here the area covered was held unreasonably wide.", "verbatimQuote": "I think it must be held that the area was unreasonably wide.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-area-too-wide" }, { "id": "jeffress-mere-competition", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "The parts of the covenant reaching beyond any genuine customer connection operated merely to protect the employer from competition, which the law does not regard as reasonable.", "verbatimQuote": "The covenant goes much further and operates so as to merely protect the plaintiff from competition in circumstances where the law does not regard that as reasonable.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-mere-competition" }, { "id": "bulk-narrow-rung", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "Tested against one of the least onerous rungs of the cascade — one month within 50 kilometres of Hobart — the covenant could only be regarded as reasonable on the evidence of the employer's business, confidential information, and competitors.", "verbatimQuote": "Having regard to the evidence as to the plaintiff's business, the nature of the confidential information provided to the defendant, and the plaintiff's competitors, that covenant could only be regarded as reasonable.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-narrow-rung" } ] }, { "slug": "garden-leave", "label": "Do paid restraints and garden leave help?", "heading": "Do paid restraints, garden leave, and fresh consideration help in Tasmania?", "answerText": "They can strengthen an employer's position, but they do not displace the reasonableness requirement, and no Tasmanian decision squarely addresses garden leave or a paid post-employment restraint. The closest local guidance is the principle that what was paid for a restraint counts in assessing it: where a restraint enhances the price a covenantor receives, that enhanced price is a factor to be taken into account in judging reasonableness — and it is a factor which is absent in the ordinary employment case.", "sources": [ { "id": "jeffress-enhanced-price", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "The enhanced price obtained for accepting a restraint is a factor in judging its reasonableness, and that factor is absent in the ordinary employment case, where the employer is not entitled to protection from mere competition.", "verbatimQuote": "The obtaining of the enhanced price is a factor to be taken into account in judging the reasonableness of the restraint. It is a factor which is absent in the case of an employment contract where in general terms a former employer is not entitled to protect himself from mere competition from the former employee.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-enhanced-price" }, { "id": "bulk-tested-at-contract-gl", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), citing Lindner v Murdock's Garage (1950) 83 CLR 628.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "Reasonableness is judged at the time of the contract, which governs how a restraint introduced mid-employment is assessed.", "verbatimQuote": "The reasonableness or otherwise of a restraint of trade must be judged by reference to the circumstances at the time of the contract: Lindner v Murdock's Garage [1950] HCA 48 ; (1950) 83 CLR 628 at 653.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-tested-at-contract-gl" } ] }, { "slug": "employer-breach", "label": "What if the employer breached first?", "heading": "What if the employer wrongfully dismissed the employee?", "answerText": "The restraint may fall away, and this is one question on which there is direct Tasmanian authority. In Neville Jeffress Advertising Pty Ltd v Barlow (No 2) the dismissed covenantor argued that termination without proper notice discharged him from the covenant. Zeeman J analysed the argument on its own terms — asking whether the employer's conduct amounted to a repudiation of the contract that would discharge the covenantor — and rejected it only on the facts, holding that immediate termination coupled with a month's pay in lieu was a quite insignificant breach. The employer also bears the onus of proving the restraint reasonable in the first place.", "sources": [ { "id": "jeffress-no-repudiation", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "Whether or not the employer breached the contract, the circumstances and nature of the breach were not such as to amount to a repudiation discharging the covenantor from the covenant.", "verbatimQuote": "Nevertheless I do not consider it necessary to come to any final conclusion about this aspect of the matter because, whether or not the plaintiff was in breach of contract, the circumstances and nature of the breach (if it was a breach) were such as not to amount to a repudiation of the contract in circumstances where the defendant was discharged from the covenant.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-no-repudiation" }, { "id": "jeffress-insignificant-breach", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "Immediate termination coupled with payment of the salary the employee would have earned over the one-month notice period was a quite insignificant breach, insufficient to discharge the covenant.", "verbatimQuote": "Secondly, as it was a term of the defendant's employment that he could be terminated on one month's notice, immediate termination coupled with the payment of the salary to which he would have been entitled in respect of that period of one month is a quite insignificant breach (see Spencer v Marchington (1988) IRLR 392 at 395).", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-insignificant-breach" }, { "id": "jeffress-money-in-lieu", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J), quoting Sir John Donaldson in Dixon v Stenor Ltd (1973) IRLR 28.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "A dismissal without notice but with money in lieu operates in law as damages for breach of contract, an approach Zeeman J preferred in analysing whether the termination breached the contract.", "verbatimQuote": "If a man is dismissed without notice but with money in lieu, what he receives is, as a matter of law, damages for breach of contract.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-money-in-lieu" }, { "id": "lindner-onus-breach", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per McTiernan J).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "The employer bears the onus of proving circumstances showing the restriction on the employee's freedom to work is reasonable.", "verbatimQuote": "The onus was on the plaintiff firm to prove circumstances showing that the restriction on the defendant's freedom to work was reasonable.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-onus-breach" } ] }, { "slug": "tolling", "label": "Does the restriction pause or extend during a breach?", "heading": "Does a Tasmanian non-compete pause or extend if the employee breaches?", "answerText": "This is an open question, and an employer should not assume the clock stops. No settled Tasmanian authority holds that a restraint period tolls — pauses and then resumes — while a former employee is in breach or while litigation runs. Reasonableness is judged by reference to the circumstances at the time of the contract, which sits uneasily with a clause that purports to lengthen the restraint automatically depending on the employee's later conduct.", "sources": [ { "id": "bulk-tested-at-contract-tolling", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bulk Frozen Foods Pty Ltd v Excell", "citation": "Bulk Frozen Foods Pty Ltd v Excell [2014] TASSC 58 (Blow CJ), citing Lindner v Murdock's Garage (1950) 83 CLR 628.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/2014/58.html", "proposition": "Reasonableness is judged by reference to the circumstances at the time of the contract, which is in tension with a clause that automatically extends the restraint based on the employee's later breach.", "verbatimQuote": "The reasonableness or otherwise of a restraint of trade must be judged by reference to the circumstances at the time of the contract: Lindner v Murdock's Garage [1950] HCA 48 ; (1950) 83 CLR 628 at 653.", "date": "2014-11-03", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-bulk-tested-at-contract-tolling" } ] }, { "slug": "customer-non-solicitation", "label": "How are customer non-solicits treated?", "heading": "How does Tasmania treat customer non-solicitation covenants?", "answerText": "Tasmania enforces a client non-solicit so far as it protects a genuine customer connection, but treats a clause reaching customers with no real connection as mere protection against competition, which the law will not allow.", "sources": [ { "id": "tas-cust-genuine-connection", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 at [30] (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "A client non-solicit may reasonably bar dealing with persons who were clients at termination, but goes too far when it merely protects against competition by reaching non-clients.", "verbatimQuote": "It might have been reasonable for the defendant to have been prevented for some defined and reasonable period after ceasing to be employed by the plaintiff from dealing with, or at least soliciting the business of, those persons who were clients of the plaintiff at the time of the termination of his employment or during some specified and reasonable time before that termination. The covenant goes much further and operates so as to merely protect the plaintiff from competition in circumstances where the law does not regard that as reasonable.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-tas-cust-genuine-connection" }, { "id": "tas-cust-severable", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 at [31] (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "An overbroad client non-solicit does not fail in its entirety where it is drafted as separate, severable covenants.", "verbatimQuote": "It does not follow that the covenant fails in toto. The six separate provisions contained within the covenant which earlier I have identified each is a separate severable covenant.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-tas-cust-severable" } ] }, { "slug": "contractors-and-sale", "label": "Do the rules differ for contractors and business sales?", "heading": "Do Tasmanian restraint rules differ for contractors and business sales?", "answerText": "Yes, in different directions. Restraints on independent contractors are assessed under the same restraint-of-trade doctrine as employee covenants — the same legitimate-interest requirement and the same no-wider-than-necessary test — so the label of the relationship matters less than the substance of the interest the restraint actually protects. Restraints given by the seller of a business, by contrast, are judged more leniently, because a buyer is entitled to protect the goodwill it paid for.", "sources": [ { "id": "lindner-sale-distinction", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per Latham CJ, dissenting as to the outcome).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "A distinction is drawn between a restraint in a sale-of-business agreement and a restraint in an employment agreement, with the former treated more favourably.", "verbatimQuote": "A distinction is drawn between a restraint upon trade included in an agreement for the sale of a business and a restraint included in an agreement with an employee.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-sale-distinction" }, { "id": "lindner-sale-more-easily", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lindner v Murdock's Garage", "citation": "Lindner v Murdock's Garage [1950] HCA 48; (1950) 83 CLR 628 (per Latham CJ, dissenting as to the outcome).", "url": "https://www.hcourt.gov.au/sites/default/files/eresources/1950/HCA/48.pdf", "proposition": "A restraint is more easily upheld in the sale-of-business context than in the employment context.", "verbatimQuote": "The restraint is more easily upheld in the former than in the latter case.", "date": "1950-09-29", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-lindner-sale-more-easily" }, { "id": "jeffress-stringent-justification", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "The less stringent approach to sale-of-goodwill restraints is justified because the restraint enhances the price the vendor can obtain for the business, a factor absent from employment contracts.", "verbatimQuote": "The justification for taking a less stringent approach in the case of the sale of the goodwill of a business than in the case of an employment contract is that in the former case the imposition and acceptance of the restraint enhances the price which the vendor can obtain for his business.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-stringent-justification" }, { "id": "jeffress-alter-ego", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "For the portion of the covenant protecting the purchased client list, the covenantor was treated as the vendor of the goodwill because the vendor company was in effect his alter ego, attracting the more lenient sale-of-business standard.", "verbatimQuote": "Insofar as the covenant relates to the Clients, it is appropriate to treat the defendant as if he were the vendor of the goodwill of the business sold by Barlow Advertising Pty Ltd to the plaintiff because, in effect, that company was the alter ego of the defendant.", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-alter-ego" } ] }, { "slug": "federal-reform", "label": "Is a federal non-compete ban coming?", "heading": "Is a federal ban on non-competes coming to Australia?", "answerText": "A ban has been proposed but is not yet law, and as of June 2026 the common-law restraint-of-trade framework above still governs in Tasmania. According to Australian Government Treasury material and law-firm commentary, the Government announced in the 2025–26 Federal Budget that it intends to ban post-employment non-competes for workers earning under the Fair Work Act high-income threshold (reported at around AUD $183,100), with Treasury running a consultation on the design, and the reform expected to be legislated during 2026 and to take effect from 2027, operating prospectively. Those figures and dates come from that secondary material — Treasury announcements and commentary — not from any enacted statute. Until any ban is enacted, the existing common-law framework continues to govern.", "sources": [ { "id": "jeffress-still-governs", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2)", "citation": "Neville Jeffress Advertising Pty Ltd v Barlow (No 2) [1993] TASSC 113 (Zeeman J), citing Herbert Morris Ltd v Saxelby [1916] 1 AC 688 and Lindner v Murdock's Garage (1950) 83 CLR 628.", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/tas/TASSC/1993/113.html", "proposition": "Under the common-law restraint-of-trade doctrine that currently governs in Tasmania, a covenant is reasonable only if it affords no more than adequate protection to the party in whose favour it is imposed, judged at the time it was entered into.", "verbatimQuote": "In considering the primary question as to whether or not the covenant is reasonable as between the parties, two propositions are fundamental, namely that in order to be regarded as reasonable the covenant must afford no more than adequate protection to the party in whose favour it is imposed (Herbert Morris Ltd v Saxelby (supra) at 707) as judged at the time the covenant was entered into (Lindner v Murdock's Garage [1950] HCA 48 ; (1950) 83 CLR 628 at 653; Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40 ; (1973) 133 CLR 288 at 318).", "date": "1993-10-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/tasmania#src-jeffress-still-governs" } ] } ] } }