Psychology Business Setup
The client is planning to establish a psychology practice in Western Australia and has concerns regarding compliance with a non-solicitation clause related to their current employment. They have indicated that several former clients wish to continue their professional relationship. The primary issue is how to navigate the restrictions imposed by the non-solicitation clause while being able to assist any previous clients who reach out during the restricted period. Understanding local employment laws in Western Australia is essential for this matter.
Questions about this case
These answers have been verified by a lawyer in the LEAP networkWhat steps should I take to ensure compliance with my current non-solicitation clause when approached by former clients?
When approached by former clients during the non-solicitation period, exercise caution by not initiating contact or encouraging their approach. Clearly inform them of your obligation to comply with the non-solicitation clause from your prior employment. Document any unsolicited communications or interactions thoroughly to demonstrate that you did not breach the clause. Consider seeking legal advice to ensure your conduct aligns with the terms of your contract and any applicable exemptions under Western Australian law.
Are there specific exceptions or limitations to non-solicitation clauses in Western Australia that I should be aware of?
In Western Australia, non-solicitation clauses are enforceable if they are reasonable in protecting legitimate business interests. However, courts often scrutinise these clauses for their scope, duration, and geographic limitations. Exceptions may apply if the restraint is overly broad or restricts fair competition beyond what is necessary. Importantly, the clause cannot prevent you from practising your profession independently. If a client independently approaches you without solicitation, this might not breach the clause, but caution is advised.
How long would the non-solicitation clause typically restrict me from contacting my previous clients?
The duration of a non-solicitation clause in Western Australia typically depends on the specific terms of your employment contract. Such clauses can range from 3 to 12 months, but it is crucial to review your specific agreement to determine the exact period. The enforceability of the restriction may also be based on factors like the significance of client relationships and the business's legitimate interests.
In the event of a dispute, what legal remedies or defenses are available to me if my former employer alleges a breach of the non-solicitation clause?
If a dispute arises concerning the non-solicitation clause, you may rely on several legal remedies or defences. You could argue that the clause is unreasonable or overly restrictive, which may render it unenforceable. You could also demonstrate that any client contact occurred independently of your actions, such as clients choosing to follow you without solicitation.
Are there any particular registration or licensing requirements for setting up a psychology business that I should consider alongside the non-solicitation clause?
To set up a psychology business in Western Australia, you must ensure you are registered with the Australian Health Practitioner Regulation Agency (AHPRA) and meet the standards of the Psychology Board of Australia, which includes holding the appropriate qualifications. You may also need an Australian Business Number (ABN) and comply with local business licensing requirements.
