Putting yourself in a strong position as regards confidential information

I read this week about Andrew Collins who had brought an unfair dismissal
claim against his employer, Cableline. His employer had accused him of
breaching its trust by sharing details of a potential piece of business it
was bidding for to a competitor over lunch. The contract involved was worth
£3m to his employer. The employee denied knowing the ins and outs of the
negotiations and also tried to argue that some of the information was
already in the public domain. It seems the Employment Tribunal rejected his
complaint so they obviously didn’t agree that this was the case.

It highlights how, as an employer, if you flag up to employees that certain
information is confidential you are in a strong position to then take action
against them if there is any leakage that can be traced to them. You might
do this by marking emails ‘confidential’ or heading documents
‘confidential’, perhaps using the watermark facility. You might do it
verbally, by explaining to staff in meetings when you are talking about
potential projects or new customers and the like that, as an organisation,
you regard that information as confidential. Further, you might emphasise it
in your contract of employment. All too often I see confidentiality clauses
that are circular and say something like ‘the company regards such
information as it decides from time to time is confidential is confidential’
– that doesn’t really get you anywhere. The best thing to do is, rather, to
have a confidential information clause which highlights the sorts of things
within your organisation that you regard as confidential. In this case it
might have been details of negotiations with potential customers.

The other issue that often arises is confidentiality at the end of the
employment relationship. For example, you might be entering into a protected
conversation under Section 111A of the Employment Rights Act with an
employee to discuss their leaving under a Settlement agreement. Whilst it
might seem really obvious to you that those discussions are confidential, it
is worth emphasising in any covering letter that the discussions are
confidential and what this means. This can prevent the horse bolting out of
the stable before you’ve even got to the signed Settlement Agreement which,
no doubt, will include a confidentiality provision. If you haven’t flagged
this up to the employee beforehand it can be too late. It might even be
worth emphasising to the employee that the offer that you are putting on the
table is conditional upon confidentiality i.e. if there is any leakage the
offer will fall away and you will revert to whatever the ‘open position’ is,
such as a redundancy exercise or a disciplinary process. I would also
emphasise the fact that under your Settlement Agreement if confidentiality
is breached payments that you would otherwise be making will no longer
become payable or, if you’ve already paid the money to the employee, that
money will be due back to the company (except for Statutory Redundancy
Payments where you cannot claw this back).

If you’ve got any questions about confidentiality, please do not hesitate to
contact me.