Moving to Employer's Client: Risk and Legal Protection

What Happens When a Veteran Employee Moves to a Client?

Uri, a worker in the electronics field with 20 years of experience, decided to move and work directly with a security client he knew well from his previous company. He thought it was a good career move. He quickly discovered that his former company did not see the move favorably and claimed he had poached clients. They went to court, and Uri had to face legal proceedings amounting to 28,500 shekels.

The central question is whether your move was a legitimate client initiative or an attempt at client poaching.

What Do Courts Actually Look At?

Israeli courts examine whether the move was initiated by the client or the employee. If the employee approached the client, encouraged them to switch, or used sensitive information to persuade, it could be considered client poaching. The distinction is made between professional skills you've accumulated over the years and the confidential information of the company you left. Personal skills are yours, but information about clients, prices, and projects is the company's asset. In Uri's case, the court saw his actions as a severe breach of loyalty to his former employer, which is why a significant compensation was awarded.

When Is This Relevant — Checklist

✓Did the client initiate the move?
✓Did you use internal information from your former company?
✓Did you offer particularly enticing terms to the client?
✓Does the move affect your relationship with the former employer?

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The Specific Law That Applies

חוק רלוונטי

Commercial Torts Law

Prohibits the theft of trade secrets

Violation can lead to substantial financial compensation

The Commercial Torts Law in Israel aims to protect companies' trade secrets. If you pressure clients to move to you or use confidential information to persuade them, you may be exposed to legal actions and hefty fines. In Uri's case, the company chose to sue only him and not the client, to maintain potential future business relations.

Questions Everyone Asks — But No One Asks the Lawyer

What if the client approached me?−

If the client initiated the contact, it could work in your favor. It's important to document the approaches to protect yourself.

What counts as client poaching?−

Proactively approaching a client with enticing offers and using internal information from the former company.

What to do if I've already moved?−

Seek legal advice immediately. Documenting approaches and communication with the client can help.

What's the cost of such a lawsuit?−

A lawsuit can cost tens of thousands of shekels, depending on the damage caused to the company.

How to protect yourself in the future?−

Keep records of all client-initiated approaches and avoid using internal information from the former company.

Real Situations — Which Side of the Line Are You On?

✓Software engineer who moved to work with a direct client known from the former company. If client-initiated, likely safe.
✓Sales manager offering discounts to a former company client to attract them. This could be considered client poaching.
✓Project manager invited to work directly by a client. If there's documentation of the client's initiative, it can protect him.

What to Do Right Now

Check the reasons for your move and if there's documentation of the client's initiative. Don't sign new contracts without consulting a lawyer. If you ignore the situation, you might find yourself in costly and complex legal proceedings. Contact an experienced lawyer to guide you through the process and protect your rights.