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How can I protect my business from an inside threat?

You have a senior manager or employee who was once a trusted and loyal member of the team but has, for any number of reasons, decided to leave. You hear, on the “grapevine” that they have approached some of your main clients or customers and another member of your team has also handed their notice in unexpectedly.

You need to seek legal advice . . . and quickly.

We often see a situation where a manager or senior employee who has been with a business for several years decides to jump ship and set up in competition. In this digital age, employees now have access to more information than ever before – client lists with full contact details, confidential information about the product or services offered by a business, sensitive pricing information and deals offered to clients. All of this information is priceless to a competitor and, in the wrong hands, could sink a business. There are steps that Sewell Law can take to work with you to protect your business.

If you have suspicions about a departing employee, the first thing we need to check is the employee’s contract of employment. Does your business have restrictive covenants in its employment contracts? These are clauses that prevent a departing employee from approaching clients, customers and other employees of the business for a certain period of time post termination of employment.

The next thing we need is evidence. Will any of the clients who have been approached by the employee provide you with a statement? Have you checked the email account of the employee? Have they sent client lists, pricing documents, order forms, supplier details, confidential information to a personal email address or another email address which is out of the ordinary? Have any other employees been approached? Have emails been sent to customers telling them to send their orders to a different email address?

We will request an immediate undertaking from the former employee and their new employer, if they are moving straight to a competitor. The undertakings will need to be provided within 48 hours (at the most) and will require the former employee to confirm what they have done, who they have approached, what confidential information they have, where it is stored and whether there are any copies.

If the undertakings are not given, the Court allows urgent applications for what are known as Springboard Injunctions. These are immediate injunctions intended to stop a former employee in their tracks. They prevent a former employee using the confidential information of a business as a springboard to gaining a competitive advantage.

Springboard injunctions are most effective when they are sought immediately. The sooner you seek legal advice, the better.

Springboard injunctions are not granted easily. The Court must be convinced that without an injunction, irrecoverable damage will be caused to the business. Seeking a springboard injunction is costly and they will usually only be granted as part of wider proceedings against the former employee for losses incurred as a result of the employee breaching their post termination restrictions.

Most businesses consider that the cost of seeking the injunction is worth protecting the business that they have worked hard to build.

Sewell Law has solicitors with expertise in obtaining Springboard Injunctions. We will quickly advise you about the strength of your case and guide you through the process.

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