Companies information, both that relating to its products or services and that concerning its clientele, is becoming increasingly valuable in an increasingly competitive marketplace. While companies often protect this information from competitors, employees are the ones that most often misappropriate this information. Moreover, with today’s technology and the trend towards working remotely, company’s information is increasingly at risk to employee theft and/or improper disclosure.
Companies need to pay attention to their legal requirements to keep certain data confidential. Failure to do so can subject their businesses to liability to other businesses, either at law or by contract, that entrust them with this information. Moreover, if the data breach involves protected information of individuals, there can be substantial reporting and remedial measures that must be taken. Companies need to be aware of their requirements to secure their data, as well as how to secure and/or dispose of all forms of media which may contain legally protected information. This includes proper restrictions on employees’ copying, removal and use of such information outside of the workplace.
There are many laws both criminal and civil which protect employers from theft of their confidential information or trade secrets. The options available to the employer may depend on how the information was misappropriated. Additionally, in order to be entitled to the protections of the laws, an employer may be required to have certain practices and policies in place. Failure to do so can adversely affect an employer’s ability to later enforce its rights should information be improperly taken or disclosed.
Employers can better protect themselves from improper employee competition and misappropriations if they have strong contracts in place covering such issues. Employers can put reasonable restraints on employee’s post-employment competition, which will make employees less inclined to engage in unfair competitive activities. Additionally, employers may be able to expand the information that is protectable and/or the remedies for misuse of a company’s confidential information by addressing these issues by contract.