When a company’s value depends on know-how… that can walk out the door

Legal protection exists, but realism is required

Without entering into individual cases, there are contractual tools commonly used to strengthen protection of intangible assets, including when employees leave the company. In such cases, it is necessary to act through targeted and, above all, coherent instruments.

These include:

• putting in place a supplementary confidentiality agreement (or confidentiality clauses) with a precise definition of “confidential information”, prohibitions on use and disclosure, custody obligations, rules on devices, accounts, repositories and documentation, and obligations of return/deletion upon termination of the relationship;
• adopting “reasonably adequate measures” — those that make a trade secret defensible in court under Article 98 of the Italian Industrial Property Code – such as role-based and least-privilege access, separation of environments, logging, permission management on repositories and drives, document classification, watermarking and structured offboarding procedures;
• remembering that during the employment relationship the employee is already bound by the duty of loyalty under Article 2105 of the Italian Civil Code, which prohibits competition and the disclosure or use of information relating to organisation and production methods in a manner harmful to the employer.

If the objective, instead, is to limit conduct after the relationship has ended, a different and highly regulated instrument is required: the non-compete covenant under Article 2125 of the Italian Civil Code, which requires written form, consideration and limits as to subject matter, time and territory, with a maximum duration of three years (see: Non-compete clauses: a useful tool that must be handled with care – Canella Camaiora).

Here realism is essential: non-compete clauses cannot be improvised and cannot be generic. The Supreme Court has repeatedly clarified a point worth stating explicitly: it is not automatically unlawful for a former employee to use their skills and professional experience in the absence of a valid restraint or a breach of trade secrets. For example, Supreme Court (Civil Division) judgment no. 18772 of 12 July 2019 is often cited to reaffirm that the use of knowledge and professional relationships is not in itself prohibited where there is no valid non-compete agreement or unlawful conduct.

Software developers and SIAE filing: why it does not solve the know-how problem

In companies that develop software, filing source code with SIAE is often perceived as a form of “total” protection. The underlying idea is that by fixing the software in a public register, the company can shield itself from developer departures, disputes over authorship or unauthorised uses.

This perception is understandable, but it needs to be properly framed.

In practice, filing software with SIAE is primarily an evidentiary tool: it serves to establish a certain date and to facilitate proof of the existence and attribution of the deposited material. It is useful to demonstrate what existed, when and in what form. However, it is not a mechanism that, by itself, prevents individuals from leaving the organisation or from leveraging the knowledge and skills they have acquired over time.

In other words, filing may strengthen the company’s position in disputes relating to the software, but it does not replace the protection of know-how as a trade secret, does not protect architectural choices, pipelines, decision-making criteria or operational procedures, and does not resolve the issues that arise after termination of the relationship.

When the goal is truly to protect algorithms, data, processes and operating logic, protection cannot be entrusted to a single instrument. What is required is an integrated approach, combining protection of know-how under Articles 98 and 99 of the Industrial Property Code through coherent and verifiable measures, the obligations that apply during the employment relationship (such as the duty of loyalty under Article 2105 of the Civil Code), and — only where appropriate — the use of a non-compete covenant under Article 2125 of the Civil Code, within the strict limits laid down by law.

The result is not only greater robustness in the event of litigation, but an organisation that makes value dispersion more difficult and transitions and turnover more manageable. And it is precisely here that the difference lies between formal protection and protection that actually holds over time.