Q: Is there anything I can do to prevent an employee from taking all my clients with her when she goes freelance?
Mar 05 2010
Answered by: Peter Done Ask a question
The only way to prevent this is by having some form of restrictive covenant in place and have that form part of the contract. While it is preferable to have already had this in place as part of your contracts, it is something that you can seek to put in place now.
Make it clear to all your employees that your client database is proprietary company information and the removal of this information will be viewed as theft and treated accordingly. A restrictive covenant cannot form an unreasonable restraint of trade. However, you can look at putting in place reasonable restrictions, although this will vary depending on the size of your company and the nature of your business.
What you may find more useful is to put in place a non-solicitation agreement. By virtue of this agreement your employee would agree not to approach any of your customers or staff with a view to tempting them away from your company. This won't prevent her from working in the same field, or even working in competition, and will not prevent your customers and staff from choosing to approach her themselves, but it means that she cannot initiate anything with a view to soliciting your employees or customers.
Without a contractual term in place preventing this there is little you can do to stop it. You will have to consider your options to protect your client base if your employee refuses to sign such an agreement as it will give a clear indication of her intention to act contrary to the proposed terms.
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