Alberta Employment Law: Non-Solicitation and Common Law Fiduciary Duties
Employers will sometimes try to prevent employees from hiring away other employees or poaching clients upon their departure. They will sometimes use non-solicitation agreements, and will other times attempt to rely upon common law duties, although this is more difficult.
Non-solicitation clauses are often not prepared properly or with the right timing by employers. When in doubt as an employee asked to sign a non-solicitation clause or agreement, talk to a lawyer.
Certain types of employees, called fiduciaries, owe stronger duties of care to their employer than other employees. In certian instances they can be found to owe duties of loyalty, and they should not solicit clients or employees of their former employer.
The test for determining whether someone is a fiduciary was described by the court in Firemaster Oilfield v. Safety Boss, 2000 ABQB 929, where the court said at 14:
(a) whether the fiduciary has scope for the exercise of some discretion or power;
(b) whether the fiduciary can unilaterally exercise that power or discretion so as to affect the beneficiary’s legal or practical interests; and
(c) whether the beneficiary is peculiarly vulnerable to or at the mercy of the fiduciary holding the discretion or power.
The caselaw talks of key, unique employees, often in small companies. The courts are very wary, however of expanding the concept of who is and isn't a fiduciary.
If you have an employer who is trying to assert non-solicitation or fiduciary arguments against you, please feel free to contact us.
The information contained in this article is not legal advice. No solicitor client relationship is formed through this article. The reader is encouraged to retain counsel for advice in these matters.