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Employment Law – Client Information Posted on Facebook Confidential

Employment Law – Background

The Supreme Court has rejected a mortgage broker’s argument that the client list he took from his old employer and provided to a competitor was no longer confidential because his old employer posted some of their clients names on Facebook.

Employment Law – Facts

In essence:

  • the mortgage broker worked for Home Loan Experts as an independent contractor, however terminated his agreement with them in November 2016
  • he was still bound by restraint clauses which prevented him from distributing Home Loan Experts confidential information for 10 years and a non-solicit provision which forbade him from engaging in similar business activities for 18 months
  • soon after he started working for competitor, RAMS Financial Group Pty Ltd
  • whilst he was allowed to provide services to family and friends, he was not allowed to lure former clients to RAMS or contact them within the 18-month restriction period
  • the broker downloaded a list containing over 100 of Home Loan Expert’s clients’ names and addresses from their system to his computer and provided it to a RAMS receptionist so she could send Christmas cards
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Employment Law – New Employer Liable in Confidential Information Case

Employment Law – Background

The following is a recent example of where a new employer was stung for the wrongs a new employee committed against their former employer …

Employment Law – The Case

In essence:

  • Lifeplan and Foresters were competitors in the business of funds management and the provision of investment products, principally for the purpose of funeral plans
  • whilst employed by Lifeplan, a manager emailed confidential Lifeplan documents to his personal email address and used these documents to prepare a business plan which he then presented to Foresters with the assistance of another manager
  • at the same time, both managers solicited the business of several funeral companies and service providers in order to secure business for Foresters and themselves
  • the managers used Lifeplan contracts, brochures and other marketing materials to prepare similar documents for themselves, and utilised Lifeplan’s printing company to generate this material
  • Lifeplan commenced proceedings against the managers and Foresters (who by this time employed the managers)
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Misuse of Confidential Information – Evidence relied upon after the fact

In the recent decision of Finemore v CMIB Insurance Services Pty Limited [2016] FWC 8517, an employer successfully relied upon evidence of misuse of its confidential information discovered following the termination of employment, in order to defend itself from an unfair dismissal claim.

The Facts

The Applicant had been employed by the Respondent (a small business employer) for approximately six years, most recently in the role of Account Executive. The Applicant was employed under a written employment contract containing several post-employment obligations including an obligation to preserve the Respondent’s confidential information

On 28 April 2016, the Applicant notified the Respondent that she was resigning her employment, and provided one month’s notice of resignation.  The Respondent accepted the Applicant’s resignation and confirmed the Applicant’s final day of employment would be 31 May 2016.

However, on 3 May 2016, the Respondent discovered that the Applicant had emailed to her personal email address a detailed Excel spreadsheet (along with other confidential files) shortly after submitting her resignation. The Respondent’s directors directed the Applicant to attend a meeting, at which time the allegations were put to her. The Respondent considered the Applicant’s responses to the allegations to be unsatisfactory, and summarily terminated her employment on the ground of serious misconduct.
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