9 May 2014. Checking Employee’s Personal Home Computers:
Nowadays, it’s only too easy for employees to retain confidential work information on personal computers or data sticks. Settlement Agreements often require ex-employees to delete any such data, but that can be difficult to enforce.
In Warm Zones v Thurley & Buckley reported this week, an employer was able to get an injunction to compel ex-employees to allow viewing and copying of their personal computer. The reason Warm Zones went after the injunction was because the ex-employees were accused of having copying or disclosing a customer database to a competitor whilst still employees.
There was evidence to suggest that the employees were attempting to sell information from the database. The Judge had to consider what the least risk of injustice there was by granting or refusing the injunction if the allegations were subsequently shown to be wrong. The Judge granted the injunction because he doubted that there was an innocent explanation for their actions.
This muscular approach to the problem proved successful for Warm Zones, but the damage might already have been done. They did have appropriate confidentiality clauses in their employment contracts, but they might have been in an even stronger position if there was contractual provision for them to inspect home computers if they had a reasonable suspicion of breach. Having IT systems in place to avoid the removal of such data in the first place might also have been worth considering. (With thanks to Daniel Barnett for news of this decision)
Post Termination Restrictions: Meanwhile in Prophet Plc v Huggett [2014] reported this month a company was still able to enforce a 12 month non-compete restriction despite a drafting mistake which meant that Mr Huggett was prevented only from selling Prophet Plc’s unique software whilst working for a competitor; something that would never happen. The Court granted an injunction against Mr Huggett, making a minimum change by adding “or similar thereto” to the end of the clause to ensure it made sense and was enforceable. It is worth checking post termination restrictions periodically to make sure that they are still enforceable and meet the needs of the business.
James Carmody. Reculver Solicitors, 1st Floor, 330 High Holborn, London WC1V 7QT