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Trade Secrets & Know-How

Know-how is essentially non-patented technical information, such as descriptions of manufacturing processes, recipes, formulae, designs and drawings. In many circumstances employees of a business have the know-how simply stored in their heads and not necessarily stored elsewhere else in tangible forms.

Some information is simply acquired from carrying out employment duties. Such information, generally classed as skill and expertise, cannot be protected by the business and, should the employees move on, will be taken with them and lost.

However, other information may be of a sensitive nature, specific only to the particular business for which the employee works. This is the valuable know-how of a business and it needs to be protected. It could, for example, be the specific settings of a particular machine in the business or the formula for a fizzy drink. If the employee left the business, that information could be lost to the business. Ex-employees are not always helpful in revealing such information and can cause considerable problems, sometimes irreconcilable, to a business.

Consider a situation where the main profit of a business is generated from the sales of one type of fizzy drink. The formula for that drink is known only to one employee and not stored anywhere else. What would happen to the business if that employee left and refused to divulge the formula, alternatively, what if that employee died?

Know-how is often a difficult area of intellectual property to ascertain. But, depending on the type of business, it could be vital to its survival and so steps should be taken to ensure protection.

Points To Note

Identify any information which a employee may have which is vital to the business and should not be lost

Write down and store any secret formulas, recipes, manufacturing processes, etc.

Protect know-how with confidentiality agreements and employment contract clauses

Ensure that sensitive information is not disclosed in non-confidential circumstances