24 October Post-employment breach costs new employer October 24, 2017 By Reef Admin Recent court decisions 0 A recent decision by the Full Court of the Federal Court of Australia marks new territory in the scale of remedy for post-employment breaches with a new employer hit with a $6.5 million order. Two employees left Employer A and took up roles with direct competitor Employer B. The Court found that the employees had engaged in seven breaches of their fiduciary and contractual duties to Employer A. The breaches included emailing Employer A’s business and financial intelligence to private email accounts and using the material to sell their services to Employer B. Other breaches included soliciting business from Employer A’s clients. The Court determined that the two employees were clearly seeking to develop a successful relationship with Employer B by actively approaching all of Employer A’s clients. As such, the Court found that Employer B was actively participating in a dishonest breach of fiduciary duty by the two employees. Without the breaches of duty in which Employer B was knowingly involved and without the two employees taking advantage of their positions with Employer A, Employer B could not have made the profits it did. Accordingly, the Court ordered Employer B to pay Employer A more than $6.5 million – an amount calculated with reference to the profits owing from the breach. Take heed! The case is an important reminder that employers must be wary of information that new employees bring with them from previous employers, as they will have obligations of fidelity and confidence which courts will uphold. Where breaches of these obligations profit the new employer, the result may be a sizeable account of pro ts against the new employer. Related Court finds 15km post-employment restraint reasonable One of the most common problems faced by real estate employers is what to do to protect the commercial goodwill of the business from exploitation by ex-employees. REEF's Workplace Relations Advisor, Laura Clark, examines this all to common problem and details a recent Supreme Court case where a real estate employer successfully had a post-employment restraint upheld. Keeping post-employment restraints intact Enforcing a post-employment restraint can be extremely complex – and expensive! Matthew Robinson provides tips to help members through the process and maximise their chances of success. Challenging an employee's post-employment conduct Before challenging a former employee's post-employment conduct, you have to be sure your own house is in order. One employer found out the hard way. Direct and indirect costs of employing a salesperson Do you know the impact engaging a full-time salesperson will have on your bottom line? When do they add value to your agency? The results may surprise you. Buying an agency? You need to understand employee entitlements The sale of a real estate agency is something most business owners will face at some point. Here are some things to be aware of when it comes to employee entitlements. The value of post-employment restraints It's a common misconception that a post-employment restraint in an employee's contract of employment isn't worth the paper it's written on. But what if you don't include one? What are the consequences? Comments are closed.