Two employees working for a Danish energy company had handed in their resignation in order to be employed in similar positions in a competing company. Their tasks included energy exchange, concluding bilateral agreements and developing new markets. At the time of their resignation their non-competition clauses were upheld, thus they were not able to begin their new work before the expiration of the clauses.
Both employees updated their LinkedIn profiles in connection with their change of jobs. Their former employer was, however, of the opinion that the updates were a breach of the two non-competition clauses. For that reason the former employer brought the case to the court.
Important who the connections were
The court noted initially that personal relationships were crucial for the two employees’ work – especially in regard of concluding bilateral agreements and developing new markets. Furthermore, the court noticed that almost all of the employees’ connections on LinkedIn got a message when the two employees updated their profiles, and that the two employees were connected to a number of people in the energy industry in Europe, which they had obtained through their previous jobs.
The court stated that it was a breach of the employees’ non-competition clause to inform their connections on LinkedIn, which they had obtained a professional relationship to through their previous jobs, about their job changes. Therefore, the two employees had to pay liquidated damages.
iuno's opinion
It is important to consider non-competition and non-solicitation clauses, if a company wants to restrict key employees’ opportunity to move to a similar job in a competing company. The Danish Marketing Act cannot by itself prevent employees from notifying the company’s customers about job changes on LinkedIn.
Furthermore, companies should have a clearly defined policy on how different types of employees are allowed to use LinkedIn and social media in general, including with who they may connect and how the issue is dealt with in case of resignation.
[Judgment given by the District Court of Aarhus on 14 may 2013 – United cases BS 10-1618/2012 and BS 10-1619/2012]