Non-compete clause a 'hit' with Saskatchewan court

Sales worker at Saskatoon radio station worker ordered not to compete with former employer within 100-kilometre radius
By Jonathan Ho
|employmentlawtoday.com|Last Updated: 03/26/2013

A Saskatchewan court has enforced a non-competition clause against a former sales employee of a radio station.

The court ordered an injunction that restrained the employee from competing with his former employer in the Saskatoon for six months within a 100-kilometre radius of the city. The injunction also restrained him from soliciting or aiding in the solicitation of any of the radio station’s clients and using any confidential information from the radio station.

In Rawlco Radio Ltd. v. Lozinski, Rawlco Radio station applied for an injunction against former employee Rob Lozinski, whose job as “senior advertising consultant” was to draw in advertising for one of Rawlco’s stations, Rock 102 FM.

Lozinski left to work for a competitor, Harvard Broadcasting, and its competing station, Wired 96.3 FM, after 10 years of employment.

The court found Lozinski had learned Rawlco’s marketing strategy and developed important personal contacts with Rawlco’s clients over his many years and — to many of these clients — Lozinski was the face of the company.

To allow him to develop a similar strategy to obtain business in direct competition with his former employer would result in major losses and irreparable harm to the radio station. The non-competition clause was therefore reasonable and an injunction was the appropriate remedy.

While this decision was made from the Saskatchewan Queen’s Bench it relied upon Supreme Court of Canada cases that would be recognized in Ontario.

However, employers should note that non-compete clauses are typically considered to be unreasonable restraints on trade and unenforceable. In rare cases such as this, where the non-compete was enforced, the court found the clause to be drafted in a reasonable and unambiguous way.

Here, the court found that the 100-kilometre boundary around Saskatoon and the six-month expiry period was a reasonable restraint on Lozinski in order to protect Rawlco’s interests.

For more information see:

•Rawlco Radio Ltd. v. Lozinski, 2012 SKQB 460 (Sask. Q.B.)

Jonathan Ho is an associate in the Advocacy Group at Cassels Brock in Toronto. He can be reached at jho@casselsbrock.com, (416) 815-4350 or visit www.casselsbrock.com for more information.

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