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LinkedIn contacts - how to make sure they belong to you, not your employee

LinkedIn – who owns customer contacts & is it necessary to have a LinkedIn policy? Salesman A resigns and hooks up with a competitor. He uses his LinkedIn account to contact all of his past customers, and pretty soon your business starts to slide…..it’s a tricky business, but can employers do anything to prevent this kind of scenario?

LinkedIn – who owns customer contacts & is it necessary to have a LinkedIn policy? Salesman A resigns and hooks up with a competitor. He uses his LinkedIn account to contact all of his past customers, and pretty soon your business starts to slide…..it’s a tricky business, but can employers do anything to prevent this kind of scenario?

Who owns customer contacts has been a vexed issue for some time. LinkedIn’s own T&Cs make clear that the account belongs to the individual, not the Company, but that creates a potentially business ruining issue for company owners.

Here are our top tips to prevent this scenario happening in the first place:

  1. Make sure contracts of employment define customer contacts gained or developed during the course of an employee’s employment are Confidential Information (as part of the Company’s customer list)
  2. Check the employee’s contract has a restrictive covenant which expressly prohibits the employee making contact with anyone on a customer list (and with whom they have been involved) for a period after the termination of their employment – a year is often reasonable for sales people
  3. When an employee resigns, send a copy of the Confidential Information and Restrictive covenant clauses to remind them of their obligations.

By taking the steps above an Employer should be able to legally prevent an employee from soliciting customers, but some employers may want to go further and insist (as part of the Social Media policy) that employees only maintain a company owned LinkedIn account for company customers (and use a private one for their own contacts.)

Either way it’s important to be prepared to enforce the protections built into your HR framework. If you are aware that an employee is breaching or is likely to breach terms, the first step is normally to ask your HR supplier (or lawyer if you insist on spending more than you need to) to write a ‘stop notice’ to the employee.

Normally that does the trick, but if it doesn’t the next stage is to hire a suitably experienced barrister to go (immediately) to the sitting judge at the High Court and ask for a temporary injunction against the employee. Provided your clauses are well written and reasonable, this can be granted on the same day, and if the employee once ordered by the court to desist does not do so, they can be found in contempt of court and will become liable for damages at a full hearing – and any competing employer inciting them to breach their covenants will be similarly liable if named in the injunction.

Now this does cost quite a lot – thousands rather than hundreds. But you will gain the protection your business needs, and if you do it once, other employees will be less likely to test you in the future.

Another thing you might consider to reduce your damage risk is to (providing you have the contractual right to do so) put your employee on garden leave for the duration of their notice period. Here the longer the notice the better, as the employee remains your servant for the whole duration and cannot work for anyone else.

Whether through garden leave or enforceable contract terms, the period the employee is unable to make contact with your customers is a period of opportunity for you to get close to those customers who you believe are most likely to be poachable. Your objective is to strengthen your relationship with them, perhaps incentivise them to sign a new contract, and generally to weaken the bond they had with your previous employee through strengthening the bond with you or with your other employees.

If you're thinking of outsourcing your HR why not contact myhrdept.co.uk. With full service Premium Plus HR & employment law packages from only £140 per month (and start-up packages from just £70 per month) and fixed price HR support options available for one-off issues, we believe we offer the best combination of quality and price available in the UK. Call us on 01628 820515 to discuss your requirements email us and we’ll call you back.