RECRUITMENT: Poaching may land firms in legal hot water

High-tech firms could face legal action for breach of confidentiality
agreements if they poach staff from competitors.

US-based analyst Gartner Group has warned IT companies against recruiting staff
on the basis of their knowledge of a competitors’ strategy, rather than their
skills and experience.

It advised firms to force new staff to sign contracts which state they are
not breaching confidentiality agreements. The problem is likely to be particularly
acute for e-commerce specialists.

The caution comes in the wake of a US case involving business software
provider SAP and a competitor, Siebel.

SAP last month brought a case against Siebel claiming it had poached two of
its executives. It alleged the staff took confidential knowledge of SAP’s

Sue Nixon, head of the employment law department at Hammond Suddards, said
similar cases were likely in the UK.

She added that the risk of legal action was increased because skilled IT
staff were reluctant to sign agreements, such as restricted covenants, which
hinder their future job prospects.

Restricted covenants state that an employee cannot join a competitor. Nixon
said e-commerce firms are having difficulties drafting these agreements because
the huge scope of the Internet makes it hard to define the restrictions.

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