"But if he signed it knowing the consequences then he should live them in my view."

Why? It is not immoral to break a contract. It happens all the time in good faith. The "wronged" party is only entitled to provable damages. Which as long as he isn't running away with trade secrets, or cold calling his old clients, then what provable damages are there?

Contracts are a civil matter. It is immoral to write a "punishment" clause into a contract and nobody should have to "live with them".