Whether you’re firm is just starting out, you are a growing company or you own a large multi-national, you’re hopefully acutely aware of the role your employees must play in protecting your IP. The question is: are they? A recent survey carried out by data control specialists Clearswift found that an alarming number of employees were unaware of their IP responsibilities and the possible impact a leak could have on their company. Furthermore, 35 per cent admitted that they’d consider selling company IP at the right price. This post covers ways you can protect your company IP through education, company culture and legal means and helps you understand how you can help staff protect your IP.
The Clearswift statistics
The general message from the Clearswift research is that many employees misconstrue the importance and value of the intellectual property information they have access to. The research, conducted among 4,000 employees from the UK, USA, Germany and Australia reveals that just 39 per cent of employees recognised that their company could be damaged as a result of an IP breach. Information security could also be deemed an issue as half of those surveyed stated they had access to IP they considered to be over their pay grade. In addition, over one in ten (12 per cent) admitted they had lost or misplaced a device that contained sensitive corporate data.
Potential employee IP pitfalls
Many employees are simply not aware of the value some types of intellectual property hold. From your carefully conceived business model and operational practices through to a secret recipe for the speciality dish at a restaurant – having information unwittingly shared can impact on your profits and harm your future success. If you’re a start up who is looking to receive further financial funding or hoping to franchise your model or products in the future, interested parties will need to be confident that you have your IP firmly locked down in order to progress. It’s therefore essential that all employees understand what constitutes intellectual property in relation to your business, their responsibilities in regards to protecting that IP and the possible consequences of failing to do so.
Those who are aware that accidental revelations made on social media, through general discussion or as a result of negligible care of papers or electronic equipment such as laptops are better equipped to show due diligence. Of course, as with all company assets there is a risk that unscrupulous employees could sell IP information to the highest bidder and we will address putting legal protection in place later in this post. Another potential and somewhat harder to avoid issue comes courtesy of our modern job-hopping society. When employees leave the company there is the very real possibility that they will take IP knowledge gained in the course of their duties with them. While certain information can be legally protected there may be aspects that will unavoidably be revealed and your operational processes, strategy and recruitment policies will need to take heed of this.
Putting IP protection in place
Monitoring staff too closely can have the undesired effect of making them feel untrusted, which can in turn lead to decreased feelings of loyalty. At an everyday level, education and engagement are your biggest allies when it comes to ensuring your employees protect your business IP. Ensuring they feel like a valued part of your business is crucial in encouraging loyalty, whatever the size of your business. This becomes even more important as your business grows in size as employees have been shown to disengage from feelings of loyalty.
While education and engagement should be at the core of your IP protection policies there are legal steps you can take to safeguard your IP from breaches by employees, sub contractors and others you work with. Firstly, in most countries individuals are prohibited from copying or sharing confidential information without consent of the owner and punishes those who have accessed information improperly.
Unlike patent protection confidentiality need not expire over time, it requires no registration with government and is effective immediately. A good example of using confidential information is the Coca Cola® recipe, which to this day remains a trade secret.
Unfortunately, keeping something confidential does not prevent against third parties trying to discover your secrets through reverse engineering, and it doesn’t stop individuals from independently coming up with the same idea by legal means. This means that a trade secret offers less protection than putting a patent in place and doesn’t actually prevent someone else patenting your recipe, formula or idea, so long as they have generated or come across that information by legal means.
As job-hopping has become a part of modern employment culture, non-disclosure and non-compete clauses have increasingly made their way into employee contracts. Generally speaking, a non-disclosure clause forms an agreement between both parties not to share any information covered by the contract and these should be used when recruiting new employees, temporary staff, interns, subcontractors or anyone else who may come in contact with sensitive information.
A non-compete clause prevents employees from setting up in competition with your business and using your IP to their advantage. This may include an agreement that they are unable to assume a similar position with a competitor or set up a similar business of their own and it’s also common to include non solicit clauses to prevent such staff inducing other employees to follow them into their new employment. Typically these agreements will operate for an agreed amount of time and potentially within a specific geographical range too, which need to be deemed ‘reasonable’.
Those putting contractual IP protection in place should ensure their HR practices support their implementation. Simple measures such as conducting staff exit interviews can help determine whether departing staff are likely to put your IP in jeopardy and can help maintain good industry relations too.
Need help identifying your IP, Want to know how to protect your intellectual property or need to address a breach? We can help. Contact our team by emailing firstname.lastname@example.org or calling 0207 989 0501. If you’re a new business, be sure to checkout our introduction to IP for small businesses.