Protecting Trade Secrets When Employees Depart

Several recent court cases in the United States focus on trade secret misappropriation by employees departing technology companies. These high profile American cases are a reminder that Canadian companies face the same issues.

Canadian courts, including the Supreme Court of Canada, have held that an employer's trade secrets are valuable commercial assets that employees must respect. In particular:

Trade secrets are by definition not widely known, are subject to reasonable efforts by employers to keep them secret, and give employers a competitive or economic advantage. There is no comprehensive legislation in Canada governing trade secrets in the civil context. In the employment context, Canadian courts have held that trade secrets can be thought of as a subset or special kind of confidential information.1 Employers do not need to reduce trade secrets to writing to protect them, but must control and safeguard access to them. Employees owe a duty of good faith and fidelity towards their...