Confidential information

Q: One of our members has been dismissed because her husband just got a job with a competitor and the company is concerned that she will pass on confidential information. Is this lawful?

A: A fear of passing on commercially sensitive information may amount to “some other substantial reason” justifying dismissal, but the employer must be able to demonstrate that dismissal was a reasonable response in those particular circumstances. The types of jobs your member and her husband did, and consequently the kind of information they had access to, are likely to be relevant factors, as is their length of service.

In the case of Chandlers (Farm Equipment) Ltd v Rainthorpe UKEAT/0753/04, an employee with 22 years’ service was dismissed on the grounds that she might pass trade secrets unintentionally to her husband — another long-standing employee who had left to work for a competitor. The Employment Appeal Tribunal (EAT) said that her dismissal was unfair because the company had no reason to doubt her integrity, given her exemplary service. She had also already signed a confidentiality clause that would make her in breach of contract if she did disclose any information. In that case, the EAT said the employer had not demonstrated that its fears were reasonably held.