Many contracts of employment aim to stop departing employees from poaching customers and key staff. Such restrictions are legally allowed, providing that they are necessary to protect the business and do not unfairly restrict the ex-employee.
With these restrictions employee and employer usually know where they stand… at least they did until fairly recently.
Social media has brought incredible opportunities to engage positively with actual and potential customers or clients, but it has also brought challenges.
In pre-social media days an ex-employee may have had information physically stored on a rolodex or computer database and their contractual restrictions would stop them taking these away. But now ex-employees can immediately update their LinkedIn/Twitter/any other social network profile with details of their new job.
What’s wrong with that? Well, LinkedIn kindly sends a message to all of the person’s contacts letting them know where they are now working. Given a core aim of LinkedIn users is to market themselves, is this, potentially, soliciting for business?
If you think so, how do you challenge? Can you require ex-employees to delete clients, customers or staff from their LinkedIn and other social media profiles? What if customers do express a desire to leave – can you prevent the ex-employee from doing business with them?
The Courts have not settled all these issues yet. A recent case, SafetyNet Security Limited v Leonard Coppage and Freedom Security Solutions Limited, states that a general advertisement to the world about being available to take on work at a new firm or changing from one firm to another does not cross the line.
But another case, Taylor Stuart v Croft, states that it is not acceptable to give details of a new place of work and then state “I can be contacted at…”. As we know, LinkedIn profiles usually state that the user would like to be contacted for new business.
In yet another case, Whitmar v Gamage, the court decided that a LinkedIn account which an employee had created and maintained for the employer was the property of the employer as it contained confidential information.
The position becomes less clear when the LinkedIn account has been set up by the employee, perhaps before they joined the business, but to which business contacts have been added.
The waters are muddy. Even if an ex-employee does message former customers through LinkedIn or other social media and does ‘advertise’ for business, it is still possible that they did not intend to do this and only wanted to update their profile. The position that the Courts will take in cases like this is far from clear.
As LinkedIn is used by 11 million people in the UK, the above issues will affect many employers.
What can employers do?
- Develop a policy on the use of LinkedIn for work purposes; providing rules on adding work-related contacts, replicating contacts on the employer’s own database, defining appropriate content, and setting out which groups are appropriate to join.
- If LinkedIn is to be used for work purposes, the employer can set up the employee’s account for them, using the company’s e-mail address and branding, and using a password that is surrendered on termination. The employee should understand that they should only be promoting their employer’s interests.
- Add into employees’ contracts provisions dealing with the employer owning contacts, deletion of business clients, contacts or accounts from their profile when an employee leaves, and banning an employee from updating LinkedIn when they are on garden leave.
- Ensure that your restrictive covenants are relevant and reasonable for each employee, bearing in mind the needs to the business and the role undertaken by the ex-employee – a one size fits all approach is unlikely to be regarded as reasonable by the courts. Please read our recent blog post on restrictive covenants for guidance.
- If possible (and reasonable) include a ‘non-dealing’ restriction which would bar ex-employees from doing any work for ex-clients/customers for a specified period.
There will always be disputes about restrictions, as ex-employees will often feel that they are unreasonable and are preventing them obtaining employment. Courts will only enforce them if they are reasonable, and this will include clauses dealing with social media issues.
They are expensive to enforce – in legal spend and business time. Courts may not be willing to stop ex-employees from using contacts in their own LinkedIn accounts.
The important principle is that employers need to ensure that all employees know where they stand with the use of social media and their work.
A good policy will explain what is expected of them and what they can and cannot do. Employers who do so will be in a better position to protect their business and avoid the expense and hassle of tribunals and litigation.