The London High Court has ordered a former Hays Specialist Recruitment employee to disclose business contacts added to his LinkedIn social networking site account before leaving the company.
The case is the first to highlight the tension between the business benefits of using social networks and the risks they pose to employer's intellectual property.
Hays alleges that consultant Mark Ions used LinkedIn to steal business contacts for use in his own company, Exclusive Human Resources, which he set up before resigning from Hays last year.
The recruitment firm went to the high court to get a disclosure order to examine the evidence to see whether it has a case against Ions for breach of confidentiality.
A courtjudgment ordered Ions to disclose his LinkedIn business contacts and all e-mails sent to or received by his LinkedIn account from the Hays computer network, but stopped short of requiring him to disclose his entire database of clients, as requested by Hays.
Ions said Hays had encouraged his use of LinkedIn, and when contacts had accepted his invitation to join his network visible to other contacts, they had ceased to be confidential.
Phillip Carnell, an associate at law firm CMS Cameron McKenna, said it was important for employers to ensure company employment contracts and internet-use policies are up to date and reflected technological changes in the business environment.
He said these documents should make specific reference to the use of social networking sites and put clear obligations on employees to delete contacts when they leave.
Alternatively, companies could be proactive by requiring employees to set up business-only accounts that remain with the company.
Carnell said Hays could take several months to consider the information it receives before deciding whether or not to go to a full hearing and claim damages for loss of confidential information, and then it could take up to a year for the trial to begin.
More on social networking:
Podcast: Accenture CIO Frank Modruson on how to exploit the power of social networking within the business >>