A company employed a sales person who signed a confidentiality and non-competition agreement. Close to the termination of his employment, the employee set up a competing business, contacted suppliers of the company and published the same inventory as the company on a website that the employee established.
The Labor Court held that the employee is to compensate the company. A trade secret by law is business information that is not public and cannot be easily discovered by others and which secrecy confers its owner a business advantage over its competitors. A list of customers and suppliers will be recognized as a trade secret if it has "added value" other than list of names. Thus, a technical list of customers and suppliers from a public database need to have additional information obtained with the investment of time and money. In this case, it was not proven that the list is a trade secret, but it did give the employee an advantage over other competitors of the company, an advantage that would not have been obtained had he not worked for the company. The Labor Court held that the employee acted in bad faith in the employer-employee relationship and therefore liable to compensation in the amount of ILS 15,000.