Introduction

A failure to take adequate care at the time of the formation of an employment relationship can cause major problems to the parties to that relationship should it subsequently unravel. The more senior the employee, the greater the potential consequences are.

This paper will examine a number of features that are of particular moment in executive employment relationships such as restraints of trade, garden leave provisions, and executive remuneration. It will also cover issues surrounding matters such as reference checking and pre-employment misrepresentations by an employee, including a discussion of recent case law developments.

It will also examine the issue of whether a relationship should be documented as an employment relationship or one of independent contractor.

When executive employment relationships break down, considerations different to those of other employment relationships are sometimes raised. This paper covers issues such as addressing a breakdown of the relationship between the employee and the Board; the consequences of a change in the majority shareholding in an employer; and the increasing tendency of employers to categorise employees as fiduciaries and hold them to more stringent obligations than those that normally arise in the employment relationship.

The termination of executive employment relationships can sometimes coincide with criminal proceedings, either instituted by the Police or the SFO. These create some particular challenges for employment lawyers, particularly around the right to silence. Recent case law developments will be discussed, particularly in relation to the range of remedies that is available for breaches of obligations by senior employees.

This paper will be of interest to employment lawyers and those commercial lawyers providing advice to medium sized and larger business entities.