A landmark High Court case will send shivers down the spines of recruitment consultants who have considered taking their employer's database with them to another company.
In the case of Hays Specialist Recruitment (Holdings) Limited & Another v (1) James Parks, (2) Christopher Bell and (3) Specialists On Site Limited (November 2006) a High Court Judge sentenced a former recruitment consultant of Hays Construction & Property to 14 days in prison arising from his theft of Hays' candidate and client lists. Following pleas in mitigation, the Judge agreed to suspend the prison sentence for six months, although the former employee was warned that it would be activated if further breaches occur during this period. The Judge also gave Judgement in Hays' favour, ordering the Defendants to pay Hays substantial costs within 14 days and an award for damages on top of this to compensate Hays for its loss.
Hays, represented by Mishcon de Reya, brought the case against the former employee and a competitor recruitment agency in August when it discovered that extracts of its client and candidate databases had been faxed from one of its offices to the competitor agency based in Southampton. Hays took action quickly and decisively: it obtained High Court injunctions in secret against its employee (James Parks) and the competitors who had sought to profit unlawfully from this information (Mr Chris Bell and his company Specialists On Site Limited). The injunctions obtained required the Defendants to cease using Hays' material and ordered them to return it immediately. Although obtained in the civil courts, the injunctions were backed up by criminal sanctions so that if they were not adhered to the Defendants may face imprisonment.
Hays succeeded in obtaining Judgement against those involved which included permanent restraining injunctions against the Defendants and an Order that they pay Hays' costs on an indemnity basis within 14 days. However, when Hays discovered that one of the Defendants had failed to comply with the Injunctions, it made an immediate application for his committal which led to the prison sentence imposed last week.
This case shows what can be achieved by a resolute recruitment agency when seeking to protect its database and commercial interests. There is also a strong message to be taken away from this: Judges will not tolerate non-compliance with Court Orders and will clamp down heavily on anyone who fails to adhere to them. It is clear that, in this case, the Judge must have considered Mr Parks' misconduct to be so serious that a fine would not be a justifiable punishment and his decision to sentence Mr Parks to 14 days in prison carries with it a winter chill for all those consultants who are tempted to steal their employer's information and use it for their own benefit.
This article is only intended as a general statement and no action should be taken in reliance on it without specific legal advice.
