A recent case has reviewed the concept of "confidential information" in employment.

The classic test of whether such information amounts to a trade secret was set out in the Faccenda Chicken case in 1986. This includes:

Were confidential matters often handled by the employee?

What was the nature of the information

Was the employee informed that the information was confidential; and

Whether the information could be distinguished from other non-confidential information. In the present case the plaintiff negotiated a termination of his employment. He subsequently made a number of comments about the company and its finances to a third party.

The company got to hear of these comments and withheld payments under the termination agreement. The plaintiff sued for the payments. The company argued it was an implied term of the agree that the plaintiff would not discuss the reasons for the termination of his employment or make detrimental remarks about the company.

The Court of Appeal held that an implied term of confidentiality can apply to a contract of employment and therefore to an agreement to terminate a contract of employment.

On the facts of this case the information discussed did not amount to confidential information of the nature of a trade secret and was not therefore protected by the implied terms.

It was held that the company had failed to show that the information disclosed was not already generally known, the plaintiff had not been told it was confidential, and it had not been distinguished from other information which was not of a confidential nature.

Jonathan Oxley is a partner with Lee and Priestley, solicitors, Bradford

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