Duty of Confidentiality

The duty of confidentiality applies to employees working for their employers, specifically, after the employment ends. There are many kinds of positions where an employee will have access to important business information belonging to his or her employer. Examples of this kind of information may include client lists, details about suppliers, details about competitors, or overall business strategies.

If an employee quits his or her position or has to be dismissed, the former employer may be left in a very vulnerable position if the employee has access to highly sensitive business information. There have been many cases in which employees have left their position on hostile terms and taken sensitive information such as client lists from their former employer.

This can cause significant financial damage to the business and the employee may end up working for a competitor. Additionally, the employer may have a duty to disclose and notiy its clients or any third parties who have had their information taken by the employee.

A 2012 case from British Columbia, Zoic Studios BC Inc. v. Gannon, 2012 BCSC 1322 (see also: Zoic Studios B.C. Inc. v. Gannon, 2015 BCCA 334) provides some of the factors to be considered when determining if information is to be treated as confidential:

1. The extent to which the information is known outside the business

2. The extent to which the information is known by employees and others within the business

3. The extent of protective measures taken by the owner

4. The value of the information to the business and its competitors

5. The financial investment made by the business to develop the information sought to be protected

6. The degree of difficulty or lack thereof for others in acquiring this information by legitimate independent means

The above is not an exhaustive list and other factors may be considered.

If you are an employer, you should make sure that your employees understand the duty of confidentiality and you should have a system in place that protects sensitive data from being taken by an employee leaving your business. This is a very technical area of law and if you are seeking to advance a breach of confidence claim, you should consult an employment lawyer.

Ken has co-authored a book on employment contracts called The Written Contract of Employment. To learn more click here.

“Whether you are just beginning your career in workplace law; practise it day in, day out, or only summarily; or are responsible for managing human resources for your employer, it is critically important that your strategy be guided by Harris and Alexander’s Written Contract of Employment.”

– Peter Israel, B.A., L.L.B.

The information on this website is for informative purposes only. It is not legal advice. A lawyer can only be retained after a consultation. If you need a wrongful dismissal lawyer or if you have any other employment law issues, call Ken at: 416 323 3614