Post-termination restrictions and the power of LinkedIn

In today’s digital age, social media networks – markedly LinkedIn – represent a significant part of an employer’s identity, communication methodology, and commercial/sales strategy. In turn, these platforms hold – and generate – sound value.

Employees may be tasked with using social media networks to manage their employer’s online presence, generate new connections – for conversion to sales – and maintain touchpoints with customers. Additionally, employees in many industries have their own social media accounts, representing themselves in their professional capacity whilst connected to their employer.

LinkedIn

In certain sectors – recruitment, sales and insurance, for example – LinkedIn holds exceptionally great fiscal and commercial power. Consequently, when an employee’s employment ends, there is a real risk that their former employer will lose the value of lucrative LinkedIn connections – and, even more commercially damaging, a direct competitor may potentially benefit from it.

When an employer has paid an employee to carry out a role, including the building and nurturing of LinkedIn connections, it stings when they are faced with the prospect of an employee sailing off into the sunset and taking those connections with them to their next employer. It’s doubly as commercially frustrating for an employer in this scenario when, crucially, the ex-employee’s new employer has not expended any time, energy, resources or money in respect of the benefits attributed to it via the valuable Linked connections attached to its incoming new employee.

We are recently seeing a substantial increase in our clients seeking legal support where employees (who have made connections and obtained key contacts via LinkedIn during their employment) are departing – and, typically, are off to work for a competitor. Social media, especially LinkedIn, therefore presents additional challenges for employers because of the:

• Ease of connections – and associated value – benefitting one employer to the next
• Potential confusion as to who ‘owns’ the LinkedIn account and, in turn, the connections formed on this account, and during what period of time.

A LinkedIn account’s connections will often constitute an identifiable list of clients, customers, suppliers, and other parties who may be interested in the employer’s business, including its products or services, made before or during the course of employment. As well as this identifiable list – essentially an online, easily accessible database – LinkedIn creates all too easy a platform upon which messages (whether covert or otherwise) can be exchanged.

Control of the LinkedIn account and the connections and contact information listed on it may remain wholly available to employees after termination of their employment – if certain steps aren’t taken by a proactive employer, ideally at the beginning of employment.

If things are not made clear at the outset of the employment relationship, blurred lines easily form between personal and employer owned connections/property – and whether such connections form ‘confidential information’ of the employer. This can pose a remarkably critical issue for employers who, for instance, operate in the recruitment industry – as client and candidate relationships, as well as business connections, are of vital importance to their continued commercial success. Many sectors live and breathe LinkedIn these days.

My employees use social media – especially LinkedIn – and I will be onboarding a new joiner soon who will also be very LinkedIn active. Help!

The default position in the UK is that post-termination restrictions are an unlawful restraint on public policy/trade. As a starting position, such restrictions are considered void. For restrictive covenants to be considered lawful and enforceable, they must:

• Be reasonable
• Be proportionate
• Go no further than is necessary to protect an employer’s legitimate business interest(s).

There are various types of restrictive covenants, including:

• Non-solicitation covenants
• Non-dealing covenants
• Non-poaching and non-employment covenants
• Non-competition covenants.

These can – and in most, if not all, scenarios should – be used in conjunction with carefully drafted confidentiality provisions, all of which generally sit within the employment contract.

Additionally, social media (even LinkedIn specific) provisions can be inserted into employment contracts and/or standalone contractual policies, ensuring there is clarity and certainty as to how the LinkedIn account should be used and to whom the connections made during employment belong. Consideration could be given to:

• A LinkedIn account being created for the purpose of that employment period only
• Connections made to a pre-existing LinkedIn account during the period of employment belonging to the employer, and for deletion or transferring of these connections to happen once notice to terminate employment has been given by either party

Savvy employers will carefully consider their business aims and objectives and will then strategically deploy a variety of tailored contractual provisions and a standalone LinkedIn or social media agreement, which together form a sound future business protection plan.

For specialist post-termination restriction and social media/LinkedIn business protection advice, please contact us.