Oil Is On the Move, and So Are Employees

Andrew Pearce, Chris Hanslik

May 24, 2018

At the BoyarMiller Energy Forum, Sanjiv Shah, managing director of Simmons & Company International, Energy Specialists of Piper Jaffray, spoke about the pickup in oil prices since the beginning of the year.

That pickup, in turn, has begun to “stimulate pretty significant upstream oil and gas hiring,” according to Karr Ingham, Texas oil economist. Although the general expectation for Houston is for energy employment to be flat in 2018, the flatness will be the result of increased hiring in oilfield services coupled with layoffs in E&P and equipment manufacturing, according to the 2018 Houston Employment Forecast by the Greater Houston Partnership (GHP).

Any increased movement of employees in the energy sector means that the steps that employers and employees take when hiring, firing, and transitioning employment will become increasingly important as parties seek to protect their rights while avoiding litigation when and where possible. Asking the right questions from the beginning can help employers and employees amicably separate, avoid costly fights, and achieve peace of mind. Some of the questions we recommend to our clients are:

 

FOR EMPLOYERS TERMINATING EMPLOYEES

• Do you have a plan in place to remind the terminated employee of any post-employment obligations, such as non-competition, non-solicitation, and/or non-disclosure obligations?

– Do you have a standard exit interview process during which you require the employee to sign an acknowledgment of such obligations?

• Do you have a process for collecting any devices provided to the employee, such as laptops or cell phones?

– Do you have the ability to review the devices to determine if any information was downloaded to an external storage device prior to the employee’s termination?

• If the employee uses his or her own devices, do you have an agreement in place to allow you to review those devices and remove any information from them?

– Do you have an understanding of what might be removed? Will you remove the employee’s contacts from his/her phone? Do you consider such information to be confidential, or is it the general knowledge acquired by the employee during his/her employment?

– Have you decided whether you want the employee to return information, or is it acceptable for the employee to destroy any information in his/her possession?

 

FOR EMPLOYEES SEEKING A NEW JOB

• Have you made sure to avoid taking any of your former employer’s information, especially any confidential information – whether unknowingly kept in personal emails or random USB devices?

• Have you made sure to avoid telling your customers or co-workers about your new employment opportunity – especially if you are going to a competitor and discussing possible opportunities to work together when you begin your new job?

• Have you disclosed any post-employment obligations to your prospective employer?

– Do you have an agreement with your prospective employer to defend you in the event of a lawsuit?

 

FOR EMPLOYERS SEEKING TO HIRE

• Have you required new employees to confirm they do not have any agreements that would restrict their potential employment?

• Have you required new employees to confirm that they are not bringing any confidential information from a prior employer?

– If the former employer threatens a lawsuit against the former employee for violating his/her post-employment restrictive covenants, are you going to continue with the employment offer?

– Do you have exposure to a claim by the former employer for tortuous interference, meaning you interfered with the former employee’s compliance with his/her agreement with the former employer?

 

These questions may be more important than ever. Today, employers are faced with the fact that an employee has access to (and the ability to take) tremendous amounts of electronic information when leaving the company.

And, once the genie is out of the bottle, it is nearly impossible to ever know with certainty that you have recovered all of it.

Likewise, with employees accessing their employers’ electronic information at home, on their personal devices, and/or remotely on company-issued devices, an employee can often have significant amounts of company information on external devices or in personal emails that poses an unintended threat if not returned to the company upon the termination of employment.

There is no “one size fits all” approach to hiring, firing, and transitioning employment. More likely, employers and employees will make mistakes – often unintentionally – when handling these issues. Yet the more proactive and transparent you can be, the greater the likelihood that an employer and employee can amicably separate without the threat or need of subsequent litigation.

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