What is the test for an employer to enforce a restrictive covenant?

Alberta, Canada


The following excerpt is from ADM Measurements Ltd. v. Bullet Electric Ltd., 2012 ABQB 150 (CanLII):

The law presumes against restraint on trade and commerce: Shafron v. KRG Insurance Brokers (Western) Inc., 2009 SCC 6 at paras. 15-17, [2009] 1 S.C.R. 157 [“Shafron v. KRG”]. As a consequence a restrictive covenant must be reasonable: Shafron v. KRG, at para. 17. The courts will refuse to enforce the claimed rights of an employer who attempts to assert an unreasonable restrictive covenant.

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