Recruiting from a competitor—issues for employers
Recruiting from a competitor—issues for employers

The following Employment practice note provides comprehensive and up to date legal information covering:

  • Recruiting from a competitor—issues for employers
  • The legal framework
  • Inducing a breach of contract
  • Inducement
  • Knowledge and intention
  • Mistaken belief that restriction(s) unenforceable
  • Conspiracy
  • Unlawful means conspiracy
  • Lawful means conspiracy
  • Unlawful interference with business
  • More...

This Practice Note examines the legal and practical issues that may arise when an employer (referred to in this note as the 'new employer') seeks to recruit an individual or, in a team move scenario, a group of individuals, from a competitor employer (referred to in this note as the 'former employer' or 'current employer').

The legal framework

The basis of litigation in employee competition situations will be the express and implied terms of the contract of employment between the employee(s) and the current employer, or, if the employee has already left, the former employer.

Obviously, the new employer is not a party to that contract of employment. Nor does it owe any direct duties to the current/former employer of the employee it wishes to recruit. However, it may nonetheless be made a party to in any litigation involving the target employee as a result of the operation of the economic torts.

The relevance of these tortious claims in employee competition situations is that they provide a direct cause of action for the former employer against the recruiting employer—the target employee does not even need to be party to the proceedings (although often the former employer will bring proceedings against relevant individual employees as well).

This will appeal to the former employer, as the new employer will almost certainly have greater financial resources than the individual employee(s) and therefore

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