An employer who receives confidential information, for example, from a new recruit, will be subject to an equitable obligation of confidence if they know at least part of the information is "likely" to be confidential and they would have discovered that it had been disclosed in breach of confidence had they made the enquiries a reasonable recipient would have made. Whether the reasonable recipient would make enquiries and, if so, what enquiries, will depend on the facts and context. If the reasonable person would make enquiries, but the recipient abstains from doing so, then an obligation of confidentiality will arise.
In Travel Counsellors Limited v Trailfinders, TCL had recruited two sales consultants who had previously worked at TFL and encouraged them to bring their customer contact lists from TFL (without flagging that this should not include confidential information). In these circumstances, the Court of Appeal ruled that a reasonable person in TCL's position would have made enquiries, thereby discovering that the information was confidential to TFL. TCL was on notice that at least some of the information was likely to be confidential to TFL, not least because TCL treated its own customer contact lists as confidential and one list of contact details for over 300 individuals was clearly likely to have been copied from TFL's database. A reasonable person in TCL's position would have made enquiries and therefore TCL was subject to an equitable obligation of confidence which it breached by using the information for its own business.
Employers need to be alert to what information is being brought to them by new recruits and should give clear instructions that this should not include confidential information. If they suspect confidential information has been brought, they should make reasonable enquiries to check the source of the information before allowing its use, to minimise the risk of claims.
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