Protecting your workforce

As employers try to navigate their way through what look to be turbulent waters, protecting key players in existing workforces will become more important. A recent High Court decision may provide some comfort in this respect.

UBS Wealth Management (UK) Ltd & anor v Vestra Wealth LLP & ors [2008] EWCH 1974 (QB)

UBS was subject to a series of mass resignations in the wake of one of its former senior managers establishing a new business, Vestra. Despite the fact that the manager was no longer subject to restrictive covenants, the High Court held that he was not free to assist and encourage the staff of UBS to "act collectively to sabotage UBS in breach of their own duties of loyalty and fidelity" and granted a springboard injunction against Vestra. The interim injunction prohibited Vestra from poaching further UBS employees or doing business with existing UBS clients pending full trial.

What can employers do?

Post-termination restrictions: Employers need to ensure that there are clear post-termination provisions in every key employee's contract of employment.

Monitoring policies: Employers must have clear policies in place that give it the right to monitor employees' emails and computer use, and to record and listen to employees' telephone calls. This will ensure that the employer can lawfully search these communications to gather the evidence necessary to protect its business interests.

Take immediate action: Immediate and effective action should be taken when an employee resigns and foul play is suspected. This includes conducting a thorough and lawful review of employee communications systems (e-mail and telephone) to gather the necessary evidence.

Notice period or garden leave: The employer can use notice periods and garden leave clauses to minimise the impact that departing executives have on its business. New client contacts should also be put in place, and measures taken to strengthen client relationships, to minimise the risk of clients leaving.

Get evidence from clients: If the team approaches clients in breach of post-termination restraints, this evidence can be especially useful.

Protect business information: The employer should keep customer lists centrally and monitor access.

Comment

The case has now settled, but this preliminary ruling will provide employers with the comfort that effective action can be taken against employees coordinating a team move.

For further information, email Sally Prosser or call 01223 461155