Successful businesses know that their most valuable asset is their employees. Their worth grows the longer that they are with your organization, representing a combination of their natural talent and the training and resources that is invested in them. If you are a business owner confronted by the reality of a former employee soliciting your existing clients, it is natural to respond with outrage and feel that they are stealing from you. But the actions available to a business owner concerned about the actions of a former employee are limited by both the actions they took look before the employee left and the way that the former employee approached the business’ clients.
The first consideration when a former employee approaches your clients is whether you had non-compete terms incorporated in your employment contract with the individual. A well-crafted employment contract will include non-solicitation terms that prevent your employee from taking their client list with them. It may even prevent them from moving on to a competitor for employment. If you have this type of language incorporated in your employment contract and the terms of your agreement are not unreasonable or overly restrictive, there’s a good chance that you will be able to take legal action, notifying the employee or their new employer that they have violated your contract’s terms and either stopping the activity or seeking damages.
Beyond the effectiveness of a non-compete agreement, there is also the question of whether your former employee’s actions will be classified as stealing. Without the protection of a non-compete agreement, you are left with the question of whether the contact information for your clients is proprietary information or a trade secret that has been unethically taken from you or whether it is available and able to be independently compiled through effort or publicly available information. The fact that your customer list represents years of effort does not automatically make it a trade secret in the eyes of the law. In fact, if your former employee called on the clients they were responsible for so often that they have the phone numbers and contact information memorized, there’s a good chance that the courts won’t view the information as proprietary or secret – unless you have a non-compete in place.
If you need help addressing issues surrounding a former employee, we can help. Contact us today to learn more.