New Directive on trade secrets: A tool against unfair labour competition?

Daniel Cifuentes and Fernando Ruiz, Labour Law partners of the firm, opened the session by reviewing the main sentences delivered in the last few months. Among others, they focused on the recent sentence handed down by the Labour Court of the Supreme Court. This sentence overturned the criteria included in its judgment of 29 September 2014, and clarified how to calculate compensation for unfair dismissal when the maximum of two years’ salary, as established by the labour reform of 2012, has been exceeded.

Next, María Eugenia de la Cera, lawyer of the Labour Law practice area at Pérez-Llorca, and Javier García Marrero, Litigation and Arbitration Counsel and Judge of the commercial courts on leave of absence, took to the floor. They evaluated the new European Directive on trade secrets, whose first reading was approved on 14 April.

After briefly explaining the development of the Directive in European bodies, de la Cera evaluated the Directive’s content. She made a special reference to its definition of trade secrets, highlighting that any information not properly protected by companies cannot be included in this definition. For this reason, de la Cera insisted that is it important to adopt measures aimed at protecting company trade secrets. She described some of these measures, such as establishing and then regularly reviewing internal policies on the topic, as well as including confidentiality clauses in agreements with employees, administrators or contractors, and establishing physical and technological measures to prevent unauthorised access to confidential information.

Javier Garcia Marrero evaluated the Directive’s impact on Spanish regulation. He reviewed the possible changes that the Directive might bring about for Spanish legislation and also reviewed, from a business perspective, both the positive and negative outcomes of the Directive. If the current text of the Directive is finally approved, both employees and companies would be made more aware of the importance of this topic, and it would also oblige companies to implement specific measures, procedures and judicial remedies. In addition, it would also extend limitation periods, as well as allow for specific measures to be put in place in order to maintain confidentiality throughout the legal process.

However, García Marrero also highlighted that the Directive does not limit the use of information that is not included in its definition of “trade secrets”. It also does not allow limitations on access to trade secrets by employee representatives when their rights to information and consultation could result in them being permitted to access said information. Furthermore, the Directive limits the claims that employees might make for damages in the event that they were not caused intentionally.