Having effective post termination obligations protecting your business to include your customer connections, skilled employees and confidential information, are essential to its success. However, such clauses in your employees’ contracts of employment should be reviewed regularly to ensure they are legally compliant, which includes ensuring they are tailored to the particular employee or category of employee rather than identical clauses for all your staff.
The recent case of Invista Textiles (UK) ltd and another v Botes and others 2019 turns the spotlight on clauses protecting confidential information. Here the departing employees retained thousands of electronic files. The Judge held that the company’s confidential information clause was defined ‘in a very wide and uncertain manner.’ For example, the confidential information to be protected included ideas and techniques forming part of an employee’s skill and expertise. It also included any document marked confidential which by the poor drafting was interpreted by the Judge to mean such documents even in the public domain. As there was no possibility of severing the words in order to have an enforceable clause protecting the company’s confidential information, it was held unenforceable against the employees.
Having an effective confidentiality clause in a contract will help employees understand what is expected of them and deter them from improper disclosure. The key issue so that a clause is more likely to be enforceable, is to draft it to cover as much confidential information as possible.