This issue was discussed by the High Court in England the recent case of Patsystems Holdings Ltd v Neilly.
Neilly initially joined Patsystems in 2000 as a junior salesman. He was given a contract including a restrictive covenant preventing him from joining competitor firms for 12 months after termination. Bog standard. On his promotion to Director of Global Accounts in 2005, he was asked to sign a letter recording the promotion, which outlined his new salary etc but stating his terms and conditions were to remain otherwise unchanged.
In 2012 Neilly resigned and told Patsystems that he was joining a competitor firm. They claimed that he was bound by the restrictive covenant in his original contract and therefore was found to be in breach of contract. They dismissed him. Patsystems applied to the High Court for an injunction against Neilly, seeking to enforce the restrictive covenant.
The High Court refused the application. It decided that at the time of Neilly's employment as a junior salesman, the covenant went further than was reasonably necessary to protect Patsystems' interest, and that the clause was void and unenforceable. The Court went on to say specifically that the void and unenforceable covenant was not brought to life by Neilly's promotion to the Director role. It had to be tested at the moment of its agreement.
Moral of the story: Get them renewed when commercial
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