Prudent business owners will go to great lengths to protect their intellectual property and confidential information from their employees and competitors.
In that regard, it is fairly standard practice in the modern workplace for employees to be required to sign confidentiality agreements and employment contracts which contain restraint of trade provisions. It is also well known that an employee’s duty of confidentiality to their employer subsists beyond termination of the employment relationship.
However, even if there is no written contract of employment with an employee, the equitable obligation of confidence will apply. Sections 182 and 183 of the Corporations Act 2001 (Cth) also bolster that obligation of confidence.
In cases where employees have breached this fundamental obligation of confidence, employers are often left asking what action they can take against their former employees. Sometimes the breaches are obvious and evidence is readily available to support the employee’s breach. In other cases, it is not so clear. The use of a forensic IT investigator can be invaluable in these circumstances. In that regard, checking the former employee’s computer (desktop) and other devices after that employee’s employment has been terminated can result in the discovery of significant information about what the employee was doing in the final months of his or her employment.
A client recently benefited from such an expert review when a former employee’s computer was subject to an in depth examination. The results demonstrated that the employee had copied a significant amount of client files and company records onto external USB drives in the months leading up to his departure from the company. This proved very important as the particular employee set up a competing business almost immediately and ultimately tried to benefit from the contents of those documents by offering services to the very clients those documents related to.
Without engaging the IT expert and benefiting from the ensuing investigation, it would have been very difficult for that employer to build a case against the employee. In that regard it is a timely reminder to all employers that relying on technology in those circumstances can be the difference between a successful outcome and what may otherwise be an unsubstantiated claim.
This article originally appeared in the Spring 2016 edition of InDispute. Other articles in this newsletter include:
- To agree or not to agree
- Retail Leases Act – Reminder expiry clauses
- Getting the terms of trade right – lessons for traders
- Battle of the ‘big yellow box’: Chemist Warehouse loses appeal
| Disclaimer: This publication contains comments of a general nature only and is provided as an information service. It is not intended to be relied upon as, nor is it a substitute for specific professional advice. No responsibility can be accepted by Rigby Cooke Lawyers or the authors for loss occasioned to any person doing anything as a result of any material in this publication.
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