Competition & Confidentiality

With the rise of information technology and the value and accessibility of electronic data, employers are increasingly concerned about the need to protect confidential and sensitive information, as well as the poaching of key employees or interference with business connections, and the avoidance of unfair competition.

Preventative steps which can be taken include the preparation of effective restrictions or garden leave provisions in service agreements and contracts of employment, as well as confidentiality agreements to suit the particular circumstances.  These contractual provisions, often referred to as restrictive covenants, can apply to conduct during employment as well as after it has ended, and to any period in which an employee is placed on garden leave or an employee is suspended.

Restrictions can be used to prevent the use or disclosure of confidential information and intellectual property, the solicitation of customers, interference with other business relationships, and the poaching of key employees.  Contractual restrictions may well be supplemented by common law such as the duty of loyalty which binds employees during employment, and fiduciary duties which bind existing directors.

We regularly advise on the reactive steps which may be taken in the event of breach of these requirements, whether by individuals or by two or more employees acting together, including obtaining appropriate warranties as to steps taken and undertakings with regard to future conduct, obtaining injunctions, and issuing claims for breach of contract and/or for an account of profits.

 

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