Small business owners have been urged to guard against former employees using sensitive data or valuable assets against them.
Most companies create, build or invent something that is crucial to their ability to trade.
But if these assets are not protected, owners run the risk of staff who leave either setting up on their own and using them to their advantage, or taking them to a competitor.
The good news is that Intellectual Property (IP) law covers anything “created using your mind” with a series of rights that can help protect SMEs.
These include trade secrets, copyright, trademarks, patents and design rights.
“It’s crucial to guard against this by having the correct employment contracts and agreements in place,” said Rebecca Jones, an IP practice leader from business law firm LegalVision.
“Workers will often need to access IP to do their jobs, but when they leave the company for whatever reason, they could be tempted to use the information to set up their own venture or benefit a competitor.”
Registering a trademark is the best way to protect your company’s logo or slogan. Even assets as niche as a colour scheme or sound can also come under the trademark umbrella.
Jones added: “In order to successfully register a trademark, it has to be unique or distinctive. It’s often something that strengthens brand identity so therefore it’s vital another firm can’t use the same one.
“One thing to consider is that there are different regulations for trademarks in the UK and overseas, so if you are operating in the global market this needs to be addressed.”
Trade secrets are another type of valuable asset that need protection. These include ingredient formulas and secret processes, and unlike other forms of IP are not commonly known outside of the originating business.
Jones said: “Intellectual property rights infringement can of course be from past employees or even those who are still working for you, so it’s best to minimise the chances of this happening in the first place.
“Employment agreements should contain explicit provisions relating to your confidential information and intellectual property – including what information you consider confidential and giving examples.
“For those that do have access to IP, have in place restrictive terms that limit the employee’s ability to use that information once they have left your company.
“This is important because general terms may not be looked upon favourably by a court.
“Intellectual property lawyers can help you with drawing up the necessary documents and putting suitable processes in place to ensure any misuse of IP occurs.
“If you are a business owner who hasn’t thought about this, now is the time to act to protect your company.”
LegalVision, which launched in the UK last month after 10 years of success in Australia and New Zealand, provides SME owners and startup founders with affordable, ongoing support through a subscription-based membership.