An Easy Exit Checklist to Prevent Employees from Leaving with Company Trade Secrets

Originally published by Leiza Dolghih.

“Hope for the best, but plan for the worst” should be every employer’s motto in handling the departure of employees.  While most will leave without any problems, some will end up breaking their non-compete agreements, soliciting their former employer’s customers and / or taking trade secrets and proprietary information to a competitor.

The following exit checklist can help any business – small or large – minimize the chances of an employee violating their post-employment duties and position the company better if it has to seek an injunction against a former employee in court:

1. Remind the employee in writing that he or she has continuing confidentiality and non-compete obligations to the company after his or her departure.
2. Provide the employee with a copy of his or her non-compete and confidentiality agreement.
3. Ask the employee where they are going and make a note regarding their answer.
4. Collect all company devices and record what was returned, when, and in what state (if any of the devices were wiped or reset by the employee, make a note and assess whether, given all the circumstances of the departure, the erasure indicates that the employee is attempting to hide something).
5. Ask the employee to sign a statement confirming they do not have any of the company’s confidential information.
6. Preserve their work e-mail for several months in case you need to review it later for pre-departure email activity indicating an intent to compete or attempts to forward confidential information outside the company system.
7. If it is a key employee, image their work computer and/or phone to preserve the record of their activities should you need to use that information in court.
8. Monitor their LinkedIn account for signs of competitive activities.

Finally, if you find out that the employee is breaching their non-compete, non-solicit of confidentiality obligations, act swiftly and contact your legal counsel.  A significant delay between learning of such activities and seeking a court order stopping the employee from engaging in such activities can undercut the company’s ability to obtain an injunction against the worker.

Leiza Dolghih is a partner at Lewis Brisbois Bisgaard & Smith LLP in Dallas, Texas and a Co-Chair of the firm’s Trade Secrets and Non-Compete Disputes national practice.  Her practice includes commercial, intellectual property and employment litigation.  You can contact her directly at Leiza.Dolghih@LewisBrisbois.com  or (214) 722-7108.

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