12 December 2013

Employer can be liable for new employee's breach of confidence

An employer can be jointly liable for a new employee's unlawful use of his previous employer's confidential information, even if parts of the employee's breach of confidence occurred before the new employee was taken on, the court has ruled.

An employee copied a database from his old employer, loaded it onto a laptop owned by his new employer and used pricing information in it to win customers away from his old employer.

The Patents County Court (PCC) ruled that the new employer was jointly liable with the employee for his breach of confidence. This included breaches that occurred before it took him on, as he was acting as the new employer's agent and the new employer knew enough about what he was up to.

Recommendation

Employers should ensure new employees have not breached confidential information belonging to their former employer, including any actions of the employee before the new employer took them on, or risk sharing liability for any such breach.

For more information please contact Ian Dawson at Shulmans on 0113 297 7735 or at idawson@shulmans.co.uk, or Lee Stephens on 0113 297 8938 or at lstephens@shulmans.co.uk.

Case ref:

Pintorex Ltd v Keyvanfar & Ors [2013] EWPCC 36