Time ticking loudly in Ryanair case around non-compete clause

Cantillon: Hearing still under way as Peter Bellew set to start Easyjet job in new year

Peter Bellew: Ryanair lawyers claim he knew of the non-compete clause in October 2017. Photograph: Collins Courts

Peter Bellew: Ryanair lawyers claim he knew of the non-compete clause in October 2017. Photograph: Collins Courts

 

Ryanair’s case against departing chief operations officer Peter Bellew boils down to whether his non-compete clause with the airline can be enforced or not.

He is due to join the Irish carrier’s rival, British airline Easyjet, as its chief operations officer in June.

However, Ryanair maintains that when he accepted 100,000 share options in the company in 2018, he signed an agreement barring him from joining any employer competing wholly or partly with Ryanair in any market.

Bellew says that this is null and void, denies breach of contract and pledges to honour all his confidentiality obligations to Ryanair. He argues the share options to which the non-compete clause is tied are dead and gone, worthless and don’t exist.

Profit-after-tax targets

The airline’s shares have mainly traded below the €14.40 at which the 2018 options were priced. Bellew argues that the profit-after-tax targets set by Ryanair as a condition of beneficiaries cashing in the options are “unattainable”.

Ryanair offered senior managers a new share option scheme, priced at €11.12, this year to replace the 2018 plan. However, chief executive Michael O’Leary told Bellew in March that he was withholding this from the chief operations officer unless he improved his performance over the coming six months.

Share scheme

The airline argues the 2018 share scheme is still very much alive and that some senior staff opted to keep it rather than take the 2019 options. Its lawyers pointed out several times that Bellew knew of the non-compete clause in October 2017, when he agreed to rejoin Ryanair from Malaysia Air, where he had been chief executive. In fact, Ryanair argues that Bellew understood the clause and accepted the clause when he signed it in June 2018.

Before the eight-day hearing began last week, both sides stressed the case was urgent, as Bellew was due to join Easyjet on January 1st. That implies that Mr Justice Senan Allen has a short time in which to weigh the evidence and the law before ruling. Nobody would envy him the task.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
GO BACK
Error Image
The account details entered are not currently associated with an Irish Times subscription. Please subscribe to sign in to comment.
Comment Sign In

Forgot password?
The Irish Times Logo
Thank you
You should receive instructions for resetting your password. When you have reset your password, you can Sign In.
The Irish Times Logo
Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.
Screen Name Selection

Hello

Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
Forgot Password
Please enter your email address so we can send you a link to reset your password.

Sign In

Your Comments
We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Standards. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or by filling out this form. New comments are only accepted for 3 days from the date of publication.