Protecting trade secrets in the workplace

On March 13, 2019, Act 1/2019, of February 20, on Trade Secrets (“LSE”) came into force, which we already discussed in a post on our intellectual property blog. LSE, a result of the transposition of a EU directive, has an impact in the workplace in that, from now on, it will be the reference framework for assessing the leakage of confidential and proprietary information by workers or former workers of companies.

In addition to LSE applying to all labor relations, it expressly refers to the workplace four times when regulating the limits on the protection of trade secrets.

1. It does this first when it establishes that the protection of trade secrets cannot affect the autonomy of the social partners (workers’ legal representatives) or their right to collective bargaining. LSE considers that obtaining information constituting a trade secret is lawful when it occurs through the workers and their representatives exercising their right to be informed and consulted, in line with the legal system and current practices. We will have to see how this fits into article 65.4 of the Workers Statute (“WS”), which recognizes, as an exception, that companies are not obliged to communicate specific information relating to trade, financial or commercial secrets, whose disclosure, according to objective criteria, could affect the operation of the company or work center or lead to serious repercussions for its economic stability. Not withstanding, of course, the duty of professional secrecy, which the mentioned article applies to all legal representatives even when their term of office has expired.

2. Second, LSE indicates that legal action against acts carried out to obtain, use or disclose a trade secret does not apply when the workers had informed their representatives, in the framework of the legitimate exercise by the representatives of the duties they are assigned by European or Spanish law, providing that that disclosure is necessary for that exercise. This is a matter of subjective assessment that will undoubtedly have to be analyzed on a case-by-case basis in the framework of the supervisory and monitoring powers article 64 WS assigns to workers’ legal representatives.

3. Third, LSE establishes three rules in relation to workers considered individually when it states that the protection of trade secrets cannot: (i) restrict workers’ mobility ; (ii) limit the workers’ use of experiences and skills required honestlyduring the normal course of their career or of information that does not meet all the requirements to be considered a trade secret; and (iii) impose restrictions in contracts that are not established by law.

4. Lastly, LSE will apply regardless of that established in Title IV of Act 24/2015, of July 24, on Patents, which establishes when the work-related inventions belong to the employee or to the employer, or when the employer becomes the owner of those inventions, as well as the right to information and the exercising of the rights by the parties.

In this framework, and to the extent that LSE requires—to be able to classify certain information as a trade secret that must be protected—that the information has been the «object of reasonable measures by its owner to keep it secret», its approval provides the opportunity (and the need) for companies to implement specific measures, such as updated confidentiality and limitation-of-use clauses, to avoid workers and former workers disclosing sensitive information.