Business Connexion (BCX), which recently lost a Labour Court bid to stop former staff members working for rival EOH, is set to appeal the court's decision.
BCX went to the Johannesburg Labour Court in an attempt to stop two former employees - Christofel Nagel and Johannes Strydom - from joining rival EOH. However, the staff members' move was found to be legitimate by judge Hilary Rabkin-Naicker, because BCX had agreed some staff could move to EOH after it lost a Sasol tender.
"The tenor of the application leads this court to conclude that the litigation had more to do with the competitive relationship between BCX and EOH within the industry that they operate," the judge ruled, also awarding costs in EOH's favour.
This decision is now set to be appealed, with BCX indicating it intends heading back to court. As a result, it would not comment any further, while EOH did not respond to a request for comment.
Competitive environment
BCX wanted Nagel to not work for a company with which BCX competes, or to provide any information or advice to such an entity, for 12 months, while Strydom's restraint was only set to run for six months.
BCX and EOH had been competing for a tender to supply manufacturing execution systems to Sasol, which BCX had been providing since 2001. The R180 million tender was awarded to EOH for three years from November 2013, and BCX entered into a transitional phase and was handing over the service to EOH.
As part of the handover, BCX agreed EOH could take over 11 of its staff members who had been working on the project.
A few months after BCX lost the deal, Nagel quit BCX to move to EOH, which led to a bidding war between the companies for his services, which BCX eventually lost. Nagel's exit was followed by Strydom's departure.
BCX argued these career moves were a breach of its restraint of trade, and threatened the confidentiality of internal information. However, Rabkin-Naicker also found "whatever knowledge any employees of BCX might have gained in regard to the production operations and processes of Sasol has equally been gained by employees of EOH and thus the knowledge of Sasol's production operations and processes does not constitute confidential information".
The listed company was later awarded 40% of the tender, with the balance remaining in EOH's hands. Rabkin-Naicker found BCX's bid "curious" in light of the agreement to transfer staff, noting its claim was weakened when the deal was spilt.
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