Protect your business from an employee leaving with crucial data

Travel Weekly has teamed up with leading industry employment lawyer Ami Naru for a regular column offering answers to readers’ legal questions on employment/HR matters. Ami will cover the latest employment issues facing the industry and respond to questions and dilemmas posed by you. In this column, Ami answers a question about former staff using company data to the advantage of their new employer.

 

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Q:

We are small-sized travel business with not many employees, but we do use consultants to sell holidays on our behalf. One such consultant has now decided to provide services to a competitor and we think he may be using our customer list. What can we do about this?

 

A.

You won’t be surprised to hear that this type of situation arises a lot, especially in the travel industry. The risk of an ex-consultant mishandling or using your confidential information can lead to reputational damage for both the consultant and the client. Also, a loss of competitive advantage may arise if pricing or supplier deals are leaked. Legal action for breach of contract or data protection laws, such as GDPR, could follow. 

 

Moreover, it could also lead to a loss of trust from high-value customers who expect discretion and their information to be protected. It goes without saying that for the travel industry, where customer relationships are often built on personal service and privacy, breaches can have lasting consequences.

 

When a travel consultant finishes providing services for a client company, the relationship might end but the responsibility to protect confidential information doesn’t, and this is often set out in the written agreement between the client and the consultant.

 

As a starting point, you should establish how your confidential information is protected, if at all. If there is no such protection you should consider incorporating this into any current or new agreements.

 

Any written agreement should set out that confidential information can cover a wide range of data, such as client list and guest contact details, itineraries or corporate travel programmes, pricing structures, supplier contracts, commission rates, negotiated rates for hotel, airline or cruise deals, internal processes, systems and marketing strategies.

 

In short, if the information is not public knowledge and provides a competitive or operational advantage, it’s generally considered confidential.

 

The written agreement should also cover what should happen to the confidential information the consultant may still have at the end of the agreement. Best practice (and often a contractual requirement) is for the consultant to return all physical documents provided by the client, delete all digital files from personal devices, email accounts and cloud storage, revoke access to client systems, booking platforms and databases, and for the consultant to confirm in writing that all client materials have been returned or destroyed.

 

Some travel companies also add non-solicitation clauses to prevent consultants from approaching clients or suppliers directly after the engagement ends. These should only be incorporated after taking legal advice, to minimise the risk of the consultant being deemed an employee.

 

In conclusion, safeguarding sensitive data is critical to maintaining trust and complying with legal obligations. You should treat your company’s confidential information like a valuable business asset: keep it secure, know where it is and ask for it to be handed back when the consultant is no longer engaged by you.

 

Even after a consultant moves on to other projects, you will stand on much firmer ground if you have specific provisions safeguarding your confidential information in your written agreement, as without such there is little that can be done.

 

This article is not a substitute for formal legal advice

 

Ask Ami a question

 

Ami Naru is partner and head of employment at leading travel law firm Travlaw Legal Services and has advised the industry on employment law for 25 years. Since qualifying as a solicitor in 2000, she has focused on building a practice dedicated to serving the industry and works with bodies including Abta, Aito and the Business Travel Association.

 

If you have any questions relating to employment law, or other areas of HR, that you would like to put to Ami, email robin.murray@travelweekly.co.uk with the subject: Question for Ami