Recruitment

Protect trade secrets in the context of rapid recruitment

Why are trade secrets particularly vulnerable at the start and end of an employment relationship?

Trade secrets represent information which is not generally known or accessible to the normal circle of people who process this type of information. It has commercial value or gives a competitive advantage because it is generally not known. In order for something to be protected as a trade secret, reasonable security solutions must be put in place by its holder. Therefore, an essential characteristic of trade secrets is that they must be protected from foreigners.

Both at the beginning and at the end of an employment relationship, trust between employee and employer is the main issue that puts trade secrets at risk. And sometimes when the working relationship ends, the trust has been broken by at least one of the parties. Without trust, there is an almost total lack of loyalty between the parties, which can lead to leaks of documents, objects, materials, etc. from an employer to third parties.

With regard to the “gig economy” in particular, what problems can a company encounter when it hires new employees frequently, both from the point of view of protecting its own trade secrets and of avoiding encroach upon those of others?

According to a report released by cybersecurity firm Deep-Secure following a survey in 2019, more than half of respondents (59%) said they took information about the company from a network or of a corporate device. The reasons vary, although personal gain and being paid by a third party seem to be of paramount importance.

Frequent employee turnover tends to prevent employee retention. Employees who are disloyal to their employer are more likely to disclose trade secrets to competitors.

Both at the beginning and at the end of an employment relationship, trust between employee and employer is the main issue that puts trade secrets at risk.

Another factor that can be taken into account is that frequent workplace changes give employees less time to internalize the company’s trade secret protection policies. Sometimes a new employee is overloaded with information during the first few days on the job and then has to navigate company rules and policies on their own.

As an employer, one should avoid employees who are willing to bring in illegally acquired trade secrets from the competition. These people will likely do the same with the new employer’s trade secrets when the next opportunity presents itself.

How can these challenges be foreseen and avoided in advance?

Employers can take appropriate steps to protect their trade secrets. These steps include, for example:

  • Define what constitutes confidential information or a trade secret, in the employment contract or in separate specific documents, and mark the relevant information as confidential;
  • Have strong onboarding policies in place to cover training for new employees, including in the area of ​​trade secret compliance, and take the time to complete such training;
  • Separate access to information according to seniority or need to know;
  • Periodically train employees on the importance of observing compliance and trade secret policies;
  • Invest in an IT infrastructure capable of alerting the employer of unusual activity from the employee’s terminal;
  • Limit or eliminate “Bring your own device” policies or similar measures.

However, in addition to robust safeguards, such as those outlined above, employers should also use soft skills in relation to their employees so that relationships do not become strained and employees are not incentivized to harm their lives. their business.

As an employer, one should avoid employees who are willing to bring in illegally acquired trade secrets from the competition. These people will likely do the same with the new employer’s trade secrets when the next opportunity presents itself.

What effect has the peak of teleworking induced by the pandemic had on the protection of trade secrets?

The pandemic has caught many businesses off guard by ensuring that the devices that employees work from at home maintain the same or comparable level of security as they use at work. Many employees have been fortunate enough to use their own unsecured and / or unsupervised devices.

This situation created more possibilities for leakage of trade secrets. On the one hand, employees were less supervised and therefore could more easily hijack files and documents, and on the other hand, criminals had a better chance of exploiting vulnerabilities in companies’ IT defenses.

Do you expect these issues to worsen as hiring practices change?

A 2018 study by the European Center for International Political Economy estimated that currently € 55 billion is lost each year due to cyber espionage. In addition, 289,000 jobs are at risk due to valuable information leaked to other states in emerging economies. The same report shows that by 2025 the equivalent of one million jobs will be at risk.

Remote working connects even more devices to the Internet, and as a result, the opportunities to exploit vulnerabilities in IT departments will only increase in the years to come. The overall commitment of employees to their work is heightened.

The trade secrets landscape will therefore remain difficult to navigate for businesses large and small for years to come.

Are there other notable challenges in the modern trade secret landscape?

One of the most difficult issues when it comes to the use of trade secrets by employees is the situation where trade secrets become an integral part of the employee’s skills and experience.

Directive (EU) 2016/943 of 8 June 2016 on the protection of undisclosed know-how and commercial information (trade secrets) against their illicit acquisition, use and disclosure expressly provides that they will not be used as reason for limiting employee mobility, in particular by limiting the use by employees of experience and skills honestly acquired in the normal course of their employment. One of these difficulties is that it is often difficult to separate trade secrets from employee skills.

In addition, the Directive does not specify whether and if former employees may use or disclose the trade secrets of a previous employer which said employee has lawfully acquired. Consequently, this type of use and disclosure of trade secrets remains a matter for the national laws of the Member States. This in turn creates uncertainty and additional costs for employers.

Flavia Stefura, Senior Partner

MPR Partners

6A rue Barbu Delavrancea, building C, ground floor, 1st district, 011355 Bucharest, Romania

Phone: (40-21) 310 17 17

Fax: (40-21) 310 17 18

E: flavia.stefura@mprpartners.com

MPR Partners is an international firm with offices in London and Bucharest. He offers expertise in business law, tax law and insolvency law across the EU and beyond, and his teams are highly ranked by many prestigious legal directories, including The Legal 500, Chambers & Partners and Lexology Client Choice.

Flavia Stefura is a key member of MPR Partners’ advisory service, primarily involved in matters of intellectual property, data privacy, competition, consumer protection and mergers and acquisitions. Bringing a wealth of experience from her work for reputable international law firms present in the Romanian market, Flavia is also versed in corporate and commercial, employment, regulatory as well as administrative matters. Recently, she also received the Award of Excellence in Intellectual Property at the 2021 Gala of the best lawyers of the Finmedia publishing house.


Source link