Stealing clients

Is there anything I can do to prevent an employee from taking all my clients with her when she goes freelance?

As the saying goes, “the devil is in the detail”, and, in this case, that of the employment contract. If your employment contracts have clauses detailing what an employee can not do post employment, such as stealing clients, you should be in a good place to protect your business. If they do not have such clauses, then you should get these added in as a priority.

These post-employment restriction clauses could cover items such as enticing one of your clients away, employing anyone from the company or leaving to work for a direct competitor. These should be for a defined period, generally six months.

Once an employee resigns, good practice would be to write to them not only to acknowledge their resignation but also to remind them of the post termination restrictions as per the contract.

If you don’t have any post termination restrictions in place, you need to ensure that you protect your client base in others ways. We would always advocate to be proactive in informing them of the fact one employee has left and their relationships/contracts will be owned in the future by someone else. Be proactive to manage any fall out or loss of clients.

Ian Moore is managing director of HR consultancy Lodge Court 

Further reading

Can my employer stop me from setting up a competing business?

 

Related Topics

Employment Contracts

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