{ "type": "practice-guide", "canonical": "https://openagreements.org/practice-guides/non-compete/au/western-australia", "links": [ { "rel": "self", "href": "https://openagreements.org/practice-guides/non-compete/au/western-australia.json", "type": "application/json" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/western-australia", "type": "text/html" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/western-australia/markdown", "type": "text/markdown" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/au/western-australia/json", "type": "application/json" } ], "data": { "topic": "non-compete", "state": "western-australia", "frontmatter": { "title": "Non-Compete Enforceability in Western Australia", "description": "In Western Australia 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; Western Australia has no statutory read-down power, so courts apply the common-law blue-pencil rule only — they can delete genuinely distinct, severable covenants but cannot rewrite an overbroad clause, and a clause that severance cannot save fails entirely.", "state": "Western Australia, Australia", "country_code": "AU", "lastReviewed": "2026-06-10", "license": "CC BY 4.0", "authors": [ "steven-obiajulu" ], "summary": { "enforceability": "reasonable", "bottomLine": "A Western Australian 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 strike out genuinely distinct, severable covenants under the blue-pencil rule 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; reasonableness is fixed at the date of contract, and no Western Australian authority validates extending a restraint because of a breach.", "maxLength": "No statutory cap; reasonableness is judged case by case (a six-month competitor restraint was upheld in Emeco International Pty Ltd v O'Shea [No 2], while a 12-month statewide restraint failed even to establish a prima facie case in Bend-Tech Group v Beek).", "noticeRequirement": "None", "saleOfBusiness": "Sale covenants judged less strictly than employee restraints", "customerNonSolicit": "Customer limb separately assessed", "employeeNonSolicit": "Employee non-solicit limb separately assessed" }, "about": [ "Western Australia non-compete agreements", "Western Australia restraint of trade clauses", "Western Australia blue-pencil severance restraint", "cascading restraint clause Western Australia", "Western Australia no statutory read-down restraint of trade", "Emeco International v O'Shea blue-pencil severance", "Bend-Tech Group v Beek restraint of trade", "Lindner v Murdock's Garage reasonableness", "Western Australia garden leave non-compete", "Australia proposed non-compete ban" ], "eyebrow": "Western Australia · Australia Law Practice Guide" }, "questions": [ { "slug": "enforceability", "label": "Are non-competes enforceable?", "heading": "Are employee non-competes enforceable in Western Australia?", "answerText": "Only so far as they are reasonable. A post-employment non-compete is treated as a restraint of trade, which the courts presume is void as contrary to public policy unless the employer shows it goes no further than is reasonably necessary to protect a legitimate business interest. The working test is two-sided: the restraint must be necessary for the adequate protection of the employer, while preserving the fullest liberty of action for the former employee consistent with that protection.", "sources": [ { "id": "austal-presumed-void", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Austal Ships Pty Ltd v Clay", "citation": "Austal Ships Pty Ltd v Clay [2018] WASC 178 (Smith AJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2018/178.html", "proposition": "Contracts in restraint of trade are presumed to be contrary to public policy and therefore void, but may be justified by the special circumstances of the particular case.", "verbatimQuote": "Although contracts in restraint of trade are presumed to be contrary to public policy and therefore void, they may be justified by the special circumstances of the particular case.", "date": "2018-06-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-austal-presumed-void" }, { "id": "bendtech-reasonableness-test", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "A restraint is reasonable only if it is necessary for the adequate protection of the employer and preserves the fullest liberty of action for the employee consistent with that protection.", "verbatimQuote": "A restraint will be reasonable in relation to the restraining party if it is necessary for the adequate protection of that party and reasonable in relation to the party restrained if it preserves the fullest liberty of action consistent with that protection.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-reasonableness-test" }, { "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/western-australia#src-lindner-onus" }, { "id": "smith-void-unless", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Smith v Nomad Modular Building Pty Ltd", "citation": "Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169 (Pullin JA).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2007/169.html", "proposition": "The Court of Appeal confirmed that covenants restraining an ex-employee from competing with the ex-employer are at common law contrary to public policy and void unless justified by the special circumstances of the case.", "verbatimQuote": "Covenants that restrain an ex-employee from competing with the ex-employer are at common law contrary to public policy and void unless it can be justified by the special circumstances of the case.", "date": "2007-08-13", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-smith-void-unless" } ] }, { "slug": "court-narrowing", "label": "Can a court narrow an overbroad clause?", "heading": "Can a Western Australian court narrow an overbroad non-compete?", "answerText": "Only in a limited way, and far less generously than many employers assume. Western Australia has no statute that lets a court read an overbroad restraint down to a reasonable level. A court applies the common-law blue-pencil rule only, and even that is strictly circumscribed: it can delete a genuinely distinct, severable covenant if what remains is reasonable and still makes sense, but it cannot read down, add to, or rewrite the clause. If severance cannot save the clause, the whole restraint fails.", "sources": [ { "id": "bendtech-severance-circumscribed", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "The role of severance for restraint clauses in employment contracts is strictly circumscribed.", "verbatimQuote": "The role of severance in the context of restraint clauses in employment contracts is strictly circumscribed.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-severance-circumscribed" }, { "id": "bendtech-no-blue-pencil", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "Severance is not permissible merely because the offending words could be struck out with a blue pencil without changing the meaning of what remains.", "verbatimQuote": "Severance is not permissible simply because a blue pencil can be used to remove the offending clause without changing the meaning of the remainder.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-no-blue-pencil" }, { "id": "emeco-client-definition", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "A single overbroad defined term incorporated into several restraints cannot be internally severed to save them.", "verbatimQuote": "The definition of 'Client' cannot be internally severed in this case.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-client-definition" }, { "id": "emeco-rewrite-restraints", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "Blue-pencilling part of a shared definition would amount to rewriting each restraint that incorporates the definition, which the court will not do.", "verbatimQuote": "To 'blue pencil' part of the definition of Client would be to rewrite each of those restraints.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-rewrite-restraints" }, { "id": "bendtech-no-prima-facie", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "Where the restraint clause was overbroad, the employer failed at the interlocutory stage to make out even a prima facie case that the clause was valid and enforceable.", "verbatimQuote": "Having said that, I have nevertheless reached the conclusion that Bend-Tech has not made out a prima facie case that the restraint clause is valid and enforceable.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-no-prima-facie" } ] }, { "slug": "cascading-clauses", "label": "Are cascading or ladder clauses valid?", "heading": "Are cascading or ladder restraint clauses valid in Western Australia?", "answerText": "Yes, within limits, and they are essential drafting in Western Australia precisely because a court cannot read an overbroad clause down. A cascading clause sets out progressively narrower combinations of period, area, and activity, each expressed as a separate, severable covenant, so that if the widest is unreasonable a narrower rung can still be enforced on its own. The Supreme Court has accepted that genuinely separate restraint covenants can be severed from one another at common law.", "sources": [ { "id": "emeco-separate-covenants", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "Genuinely separate restraint covenants can be severed from one another at common law, and an express severance clause confirms that intention.", "verbatimQuote": "The clear intention of the contractual severance clause is that the Competitor Restraint could be severed from the other restraints and this is possible at common law since those clauses are really separate covenants.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-separate-covenants" }, { "id": "emeco-split-outcome", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "Because the covenants were separate, the court could enforce the competitor restraint while holding the other restraints unenforceable.", "verbatimQuote": "My conclusion is that the restraint which I have described in these reasons as the Competition Restraint, preventing Mr O'Shea from performing work for NPE, is enforceable. Other restraints upon which Emeco relied are not enforceable.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-split-outcome" }, { "id": "bendtech-attwood", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J), quoting Attwood v Lamont (Younger LJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "Severance is permissible only where the covenant is not really a single covenant but is in effect a combination of several distinct covenants.", "verbatimQuote": "The doctrine of severance has not, I think, gone further than to make it permissible in a case where the covenant is not really a single covenant but is in effect a combination of several distinct covenants.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-attwood" }, { "id": "austal-prima-facie", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Austal Ships Pty Ltd v Clay", "citation": "Austal Ships Pty Ltd v Clay [2018] WASC 178 (Smith AJ).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2018/178.html", "proposition": "At the interlocutory stage the Court assessed each limb of the restraint separately, found no prima facie case for the two non-solicitation limbs, and was satisfied — on the basis of confidential information — that there was a prima facie case the restraint was reasonable and enforceable.", "verbatimQuote": "In these circumstances, I am satisfied that Austal has demonstrated a prima facie case (or that there is a serious question to be tried) that the restraint in cl 8.2 is reasonable and enforceable.", "date": "2018-06-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-austal-prima-facie" }, { "id": "emeco-definition-not-severable", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "A single overbroad definition feeding several restraints cannot be internally severed, so the breadth of a defined term endangers every restraint built on it.", "verbatimQuote": "The definition of 'Client' cannot be internally severed in this case.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-definition-not-severable" } ] }, { "slug": "legitimate-interest", "label": "What interest must an employer protect?", "heading": "What legitimate interest must an employer show to enforce a Western Australian 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 recognised interests are the employer's customer connection and its confidential information, and a single restraint may be justified as protecting more than one of them.", "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/western-australia#src-lindner-face-competition" }, { "id": "austal-recognised-interests", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Austal Ships Pty Ltd v Clay", "citation": "Austal Ships Pty Ltd v Clay [2018] WASC 178 (Smith AJ), quoting Workplace Access and Safety Pty Ltd v Mackie [2014] WASC 62 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2018/178.html", "proposition": "The legitimate interests by which a restraint is commonly justified are customer connection and confidential information, and a restraint may protect more than one interest.", "verbatimQuote": "The legitimate interests about which a restraint is commonly justified is customer connection and confidential information. A restraint may be justified as protecting more than one legitimate interest.", "date": "2018-06-15", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-austal-recognised-interests" }, { "id": "bendtech-working-life", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "A non-competition clause that would stop a former employee from using the skills accumulated over virtually his whole working life to earn a living reaches beyond any protectable interest into the employee's own know-how.", "verbatimQuote": "As for the non-competition clause, this clause effectively prohibits Mr Beek not only from acting as a director of Tarian Pty Ltd, but also of using the skills he has accumulated over the course of virtually the whole of his working life to earn a living in the employ of any business similar to that operated by Bend-Tech.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-working-life" }, { "id": "emeco-interest-sufficient", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "A legitimate interest in confidential information and customer connections was sufficient to show that the competitor restraint was reasonable.", "verbatimQuote": "For the reasons explained above, Emeco's legitimate interest in its confidential information and in protecting its customer connections is sufficient to show that the Competitor Restraint is reasonable.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-interest-sufficient" } ] }, { "slug": "reasonableness-factors", "label": "How long and how wide can it be?", "heading": "How long and how wide can a Western Australian 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 actual customer influence. Reasonableness is tested as at the date the contract was made, not by hindsight, although later events can shed light on what the parties could reasonably have estimated at that date. An area wider than the employer's business reaches, or a period longer than the interest requires, is likely to be unreasonable.", "sources": [ { "id": "smith-tested-at-contract", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Smith v Nomad Modular Building Pty Ltd", "citation": "Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169 (McLure JA, citing Amoco v Rocca Bros per Walsh J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2007/169.html", "proposition": "The validity of a restraint is decided as at the date of the contract.", "verbatimQuote": "The validity of the restraint must be decided as at the date of the contract: Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40 ; (1973) 133 CLR 288 at 318 per Walsh J.", "date": "2007-08-13", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-smith-tested-at-contract" }, { "id": "bendtech-subsequent-developments", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "Reasonableness is determined at the date of the contract, but subsequent developments can be considered to test whether the agreement was reasonable at that date, having in mind the parties' best estimate of the future.", "verbatimQuote": "Although the question of reasonableness is determined at the date of the contract, subsequent developments can be considered to determine whether the agreement was reasonable at the date of contract, having in mind the best estimate that the parties could make for the future.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-subsequent-developments" }, { "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/western-australia#src-lindner-area-too-wide" }, { "id": "emeco-six-months-reasonable", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Emeco International Pty Ltd v O'Shea [No 2]", "citation": "Emeco International Pty Ltd v O'Shea [No 2] [2012] WASC 348 (Edelman J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2012/348.html", "proposition": "A six-month restraint period was held reasonable, with the real fight being over the breadth of the restraint's operation rather than its duration.", "verbatimQuote": "No substantial submission was made to suggest that the six month period of the restriction was unreasonable. I am satisfied that it was reasonable.", "date": "2012-10-17", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-emeco-six-months-reasonable" }, { "id": "cream-objective-duration", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Cream v Bushcolt Pty Ltd", "citation": "Cream v Bushcolt Pty Ltd [2004] WASCA 82 (Malcolm CJ; Miller and McKechnie JJ agreeing).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2004/82.html", "proposition": "Whether the duration of a restraint is reasonable is an objective question.", "verbatimQuote": "The objective question is whether the duration of the restraint was reasonable.", "date": "2004-04-22", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-cream-objective-duration" } ] }, { "slug": "garden-leave", "label": "Do paid restraints and garden leave help?", "heading": "Do paid restraints, garden leave, and fresh consideration help in Western Australia?", "answerText": "They can strengthen an employer's position, but they do not displace the reasonableness requirement, and no Western Australian authority discussed here decides a case squarely on a paid restraint or a garden-leave clause. The framework remains the same two-sided test: necessary for the adequate protection of the employer, while preserving the fullest liberty of action for the employee consistent with that protection. Payment for a restraint is sensibly understood as a factor that may support reasonableness within that test, not a separate gateway to enforcement.", "sources": [ { "id": "bendtech-twin-test-gl", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Bend-Tech Group (A Firm) v Beek", "citation": "Bend-Tech Group (A Firm) v Beek [2015] WASC 491 (Pritchard J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASC/2015/491.html", "proposition": "Any restraint, paid or unpaid, must be necessary for the adequate protection of the employer while preserving the fullest liberty of action for the employee consistent with that protection.", "verbatimQuote": "A restraint will be reasonable in relation to the restraining party if it is necessary for the adequate protection of that party and reasonable in relation to the party restrained if it preserves the fullest liberty of action consistent with that protection.", "date": "2016-04-11", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-bendtech-twin-test-gl" }, { "id": "smith-tested-at-contract-gl", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Smith v Nomad Modular Building Pty Ltd", "citation": "Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169 (McLure JA, citing Amoco v Rocca Bros per Walsh J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2007/169.html", "proposition": "Validity is decided as at the date of the contract, which governs how a restraint introduced mid-employment is assessed.", "verbatimQuote": "The validity of the restraint must be decided as at the date of the contract: Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40 ; (1973) 133 CLR 288 at 318 per Walsh J.", "date": "2007-08-13", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-smith-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. The employer carries the onus of proving the restraint reasonable in the first place, so an employer seeking an injunction already starts from a position where it must justify the covenant. Beyond that, the long-standing common-law principle associated with General Billposting Co Ltd v Atkinson [1909] AC 118 is that an employer who wrongfully dismisses an employee — for example by repudiating the contract through a dismissal without the notice the contract requires — generally cannot afterwards enforce a post-employment restraint against that employee. The Western Australian authorities discussed here do not themselves decide that point, so it is best treated as a general principle a court may apply rather than a settled Western Australian rule.", "sources": [ { "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/western-australia#src-lindner-onus-breach" } ] }, { "slug": "tolling", "label": "Does the restriction pause or extend during a breach?", "heading": "Does a Western Australian 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 Western Australian authority holds that a restraint period tolls — pauses and then resumes — while a former employee is in breach or while litigation runs. Validity is decided as at the date 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": "smith-tested-at-contract-tolling", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Smith v Nomad Modular Building Pty Ltd", "citation": "Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169 (McLure JA, citing Amoco v Rocca Bros per Walsh J).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2007/169.html", "proposition": "Validity is decided as at the date of the contract, which is in tension with a clause that automatically extends the restraint based on the employee's later breach.", "verbatimQuote": "The validity of the restraint must be decided as at the date of the contract: Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd [1973] HCA 40 ; (1973) 133 CLR 288 at 318 per Walsh J.", "date": "2007-08-13", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-smith-tested-at-contract-tolling" } ] }, { "slug": "contractors-and-sale", "label": "Do the rules differ for contractors and business sales?", "heading": "Do Western Australian 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/western-australia#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/western-australia#src-lindner-sale-more-easily" }, { "id": "cream-iraf-duration", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Cream v Bushcolt Pty Ltd", "citation": "Cream v Bushcolt Pty Ltd [2004] WASCA 82 (Malcolm CJ; Miller and McKechnie JJ agreeing).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2004/82.html", "proposition": "For a sale-of-business restraint, the most important consideration on duration is the time required to sever the relationship between the vendor and the clients who would patronise the business after the sale.", "verbatimQuote": "In this context it has been held that the most important consideration is the time required for severing the relationship between the vendor and those clients who would patronise the business after the sale: IRAF Pty Ltd v Graham [1982] 1 NSWLR 419 at 428 - 4529, per Roth J; and see Fleming Brothers (Monaro Agencies ) Pty Ltd v Smith (1983) ATPR 40-389.", "date": "2004-04-22", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-cream-iraf-duration" }, { "id": "cream-ten-year-excessive", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Cream v Bushcolt Pty Ltd", "citation": "Cream v Bushcolt Pty Ltd [2004] WASCA 82 (Malcolm CJ; Miller and McKechnie JJ agreeing).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2004/82.html", "proposition": "A ten-year duration was held excessive and beyond what reasonable protection of the purchased goodwill required, particularly where no part of the consideration was allocated to goodwill.", "verbatimQuote": "In the face of the concession by Mr Jones in the context of the objective facts, I consider that the 10-year duration of the restraint was excessive and beyond that required for the reasonable protection of the goodwill of the business being purchased, particularly in the context that no part of the consideration was allocated to goodwill.", "date": "2004-04-22", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-cream-ten-year-excessive" }, { "id": "cream-cumulative-effect", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Cream v Bushcolt Pty Ltd", "citation": "Cream v Bushcolt Pty Ltd [2004] WASCA 82 (Malcolm CJ; Miller and McKechnie JJ agreeing).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2004/82.html", "proposition": "Even where some restraint would have been reasonable, the cumulative or combined effect of the restraints taken together constituted an unreasonable restraint of trade.", "verbatimQuote": "The cumulative or combined effect of the restraints taken together, however, constituted an unreasonable restraint of trade.", "date": "2004-04-22", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-cream-cumulative-effect" } ] }, { "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 Western Australia. 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": "smith-still-governs", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Smith v Nomad Modular Building Pty Ltd", "citation": "Smith v Nomad Modular Building Pty Ltd [2007] WASCA 169 (Pullin JA).", "url": "https://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/wa/WASCA/2007/169.html", "proposition": "Under the common-law restraint-of-trade doctrine that currently governs in Western Australia, a covenant restraining an ex-employee from competing is void unless justified by the special circumstances of the case.", "verbatimQuote": "Covenants that restrain an ex-employee from competing with the ex-employer are at common law contrary to public policy and void unless it can be justified by the special circumstances of the case.", "date": "2007-08-13", "anchor": "https://openagreements.org/practice-guides/non-compete/au/western-australia#src-smith-still-governs" } ] } ] } }