Employment Law Injunctions
What is an Injunction?
An injunction is an Order from the Court which either prevents a party from doing something or forces a party to do something. An injunction is not easy to obtain and as it is an equitable remedy made at the Court’s discretion.
An injunction will only be granted where: (i) it is just to grant one; (ii) the party asking the Court to grant the injunction acts quickly and does so with “clean hands” (i.e. they have conducted themselves properly and legitimately); and (iii) damages (i.e. financial compensation) would not be an adequate remedy.
Applying for an injunction – on notice or without notice?
There are two types of injunctions, those obtained “on notice” and those “without notice”. The former is where the party seeking the injunction informs the other party of the application including where and when it is being heard. A without notice injunction is one where the party seeking the injunction does not inform the other party of the application in which case the Court will only grant the injunction where there is good reason for not giving notice to the other side.
Without notice injunctions are normally sought where the party applying believes, and argues, that if the employee was made aware of the application he, she or they might urgently destroy, copy or move evidence or assets, perhaps including money or the risk is so great to the employer’s business, such as where all customers might be contacted by a competitor, that the application is critically urgent.
Injunctions against employees
The 3 most common scenarios for injuncting an employee are :-
- where the employee has or is believed to have unlawfully taken and/or used confidential data such as customer or client lists from the employer and may be about to or have passed that information onto a competitor.
- in circumstances where the employee is a senior employee, there are restrictive covenants in the employment contract, the employee might already be on Garden leave, but the employee is unlawfully seeking to poach clients or colleagues.
- where fraud is suspected by an employee.
Interim or temporary injunctions will only be granted in circumstances where the party making the injunction application undertakes to pay the other side’s costs, expenses and losses should the interim injunction be granted but be unsuccessful at the return (on notice) hearing.
A breach of an injunction may result in the party disobeying the order being held in contempt of Court and could even lead to imprisonment.
Balance of convenience test
There are also some additional principles that have to be considered before the Courts will grant the employment injunction and this is known as the “balance of convenience” test; which requires the Court to take the following factors into consideration when granting the injunction:
1. Actual or potential damage to the employer’s business;
2. Inconvenience to the employee (financial or other);
3. Whether an undertaking has been given by the employee to abide by the contractual provision that is now being enforced or prevented from being breached; and
4. No relief is being sought other than is strictly necessary.
If you are an employer worried about the impact actions of an ex-employee or current employee may be having on your business, we can help. If an employee is poaching customers or staff or is using your valuable data or know how, you normally need to act fast and decisively. If you are an employee and are facing potential legal action by an employer or ex-employee, we can also help you and are highly experienced with injunctions and employment contracts and disputes generally.
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