Court weighs in on worker obligations in handling sensitive workplace information
The Supreme Court of New South Wales recently dealt with an employment case about confidential business information. The dispute involved questions about an employee's obligations regarding sensitive data both during and after employment.
The worker defended her actions, arguing that transferring business information to personal devices was part of performing her regular duties. She explained this was necessary for handover purposes and due to technical access limitations.
The employer requested court orders to prevent information sharing and to recover confidential materials, particularly focusing on protecting a valuable rent roll containing client and business data.
The case centered on a real estate agency in Avoca Beach and their former senior property manager. At issue was a rent roll purchased for $880,000 that contained management agreements between the agency and landlords for 161 properties.
The employment agreement defined confidential information to include "names, addresses (including email addresses), phone numbers and all other contact information of sellers, buyers, prospective sellers and buyers, any property owner (including their employees, contractors, and representatives) on whose behalf a property is managed by the [employer]."
The situation escalated in May 2022 when the worker resigned to join a competitor. During this conversation, evidence showed she made comments about landlords potentially following her, which prompted the employer to seek legal protection.
The court found that confidential information had been moved to personal devices. In the judgment's words: "I am satisfied on the evidence, and I find, that [the worker] did transfer to her personal hard drive confidential information relating to the rent roll managed by her as an employee of [the employer] during her employment with [the employer] which she took away when that employment ceased."
The evidence included emails sent to personal accounts and documentation shared through Google Drive. When questioned about these transfers, the worker's explanations were found to be inconsistent with other evidence.
The court also noted unauthorized sharing of documents: "No explanation was provided by [the worker] for making this document available to [the previous employer] and, by doing so, [the worker] breached cl 14.2 (b) of her employment agreement."
The employment agreement contained specific confidentiality provisions but notably did not include post-employment competition restrictions.
The court identified several breaches, stating: "The deletion of emails from [the worker's] work email account was a breach of clause 16.4 of the employment agreement."
Evidence showed the worker had used an external hard drive for over 12 years in her property management work, yet claimed to have disposed of it when legal proceedings began.
The court determined: "I have concluded that rent roll acquired by [the employer] from the vendors is confidential information of [the employer] for which it is entitled to protection by way of injunctive relief."
The judgment clarified the legal basis for protection: "[T]he rent roll meets the first three requirements for equitable relief. I am satisfied on the evidence that there has been an actual misuse by [the worker] of this confidential information without [the employer's] consent."
The court ordered the worker to stop using or sharing rent roll information, return physical copies of confidential information within 30 days, and provide an affidavit detailing any previous disclosures.
The court also vacated earlier interlocutory injunctions and allowed parties to make submissions about costs.
