Acumen News & Events

11 May 2010

Fresh pool of talent or the tried and tested approach?

How do employers recruit the ‘best talent’?

Employers naturally want to recruit the ‘best talent’, individuals who can really add value and bring something to their business. A fresh face and a keen outlook can sometimes be the employee of choice, but what if an employer is looking for someone with experience, grounding in their industry and a strong following? Whilst rival employers will always work to protect their company from the potentially devastating effects of ‘poaching’, taking key staff from your rival can offer many substantial benefits to your workforce and existing team.

The act of poaching staff however is not without its difficulties, here are just a few of the factors which you should consider.

Recruitment is often carried out in an inherently covert manner. Employers will be aware of which teams within their company are susceptible to poaching, and the larger the team or group of individuals being poached the easier the detection of a move will be.

Signs of a move will include changes in behaviour, off site meetings, unusual absences and/or travel plans. In instances of a team being poached the resignation of junior employees can be a sign that a move is being orchestrated.

Once a move has been decided don’t forget that the employee will still be required to work their contractual notice period unless there is an opportunity to effectively ‘get out early’ with a payment in lieu of notice or garden leave clause. Employers need to consider however the possibility of rivals preventing out-going staff from working for a new employer for a ‘reasonable’ period of time should they chose to enforce the terms of the employee contract, rivals may be wary of requests to leave early.

Prospective employers should also be aware of restrictive covenants in the employees’ existing contract with the rival company. Are there any non-soliciting or non-dealing covenants in their contract which the employee will be in breach of? Where there is a breach of an existing contract then the employee could face legal action from the rival employer or the threat of the same. Where the prospective employer is able to back the employee financially this may not cause much of a problem, but what if the prospective employer cannot step up to the financial plate? The new employee can also be pursued for 'inducement to breach'. Quite often the rival will go down this route on the basis that the employer has deeper pockets.

Assuming the employee does move to the new employer, how will the covenants in their contract hinder their ability to integrate and drive forward in their new role? Would the rival go so far as to seek an injunction to prevent soliciting of Clients and/or business? Would the rival company attempt to seek damages or an account for profits for any business lost as a result of the move?

Rival employers are likely to focus predominantly on preventative measures, this being the most cost effective action open to them. With this in mind prospective employers should be particularly wary of well drafted garden leave and confidentiality clauses tightly linked to the employee's role.

Your company may be recruiting the best staff available, but at what potential cost?