High Court ruling gives employers victory over staff poaching by competitors

Recruiters will likely eye with interest a newly handed down High Court ruling involving staff poaching.

Wed, 30 Jul 2014Recruiters will likely eye with interest a newly handed down High Court ruling involving staff poaching.

The case involved an employee who walked out from his job at derivatives broker Sunrise Brokers having been hired by a competing business and then refused to work his notice period.

The employee, Michael Rodgers, walked out of Sunrise’s London office last March without notice – having accepted a position in a competing US-based business with a UK operation, despite being subject to notice and post-termination restrictions, according to a statement released on behalf of Sunrise’s legal team, Twenty Twenty Law.

The statement said Rodgers later submitted his written notice on 16 April, ignoring the fact that he was subject to a fixed-term contract to 22 September followed by a 12-month notice period. Sunrise agreed to reduce his notice to six months followed by a further six-month restrictive covenant that, as per his contract, banned him from working for a competitor “but”, the statement said, “to no avail”.

Following Rodgers’ failure to go to work, Sunrise stopped paying his salary.

Sunrise also instructed Twenty Twenty Law to seek an injunction which would hold Rodgers to a period of notice and bind him to his restrictive covenants.

“Although his contract did contain a garden leave clause, this was only to be exercised at the employer’s discretion and not simply on his demand,” the statement said.

In a response to an enquiry from Recruiter, a Twenty Twenty press spokesman said that Rodgers had not attempted to poach anyone else in the company “as far as we are aware”.

The High Court ruled that Rodgers was still employed by Sunrise, that he was bound by a period of notice period and that he had no right to force the conversion of his notice period into garden leave.

Summarising the ruling as “an important victory for UK employers and for common sense”, Twenty Twenty managing partner David Green Greenhalgh went on to say that businesses were “entitled to protect themselves from attack by competitors who try to poach their staff and clients.

“What this case highlights is the importance of having proper foundations in place to defend attacks from competitions, in the form of well-drafted contracts documentation.”

Twenty Twenty has represented staffing companies in similar matters, the company’s spokesman said.

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