Confidential Information — Ontario Employment Law
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About Confidential Information
In Ontario employment law, "confidential information" refers to the proprietary data, trade secrets, and internal knowledge that give a business its competitive advantage. While employees naturally acquire new skills, general knowledge, and experience during their tenure, this general "know-how" belongs to the worker. Confidential information, however, remains the exclusive property of the employer. Courts draw a sharp distinction between a worker's personal professional development and the prohibited taking of an employer's protected assets, such as specialized pricing formulas, internal financial projections, proprietary source code, or highly guarded client lists.
The obligation to protect this information arises in two primary ways. First, written employment contracts routinely include specific clauses outlining exactly what data the company considers proprietary and explicitly forbidding its use or disclosure during and after employment. Second, even in the complete absence of a written contract, Ontario's common law imposes an implied duty of fidelity and good faith on all employees. This means you cannot misappropriate trade secrets to unfairly compete against your former boss. Senior managers and executives often owe heightened "fiduciary duties," elevating their legal obligation to protect sensitive company information beyond that of front-line staff.
Disputes over proprietary data frequently erupt when an employee resigns to join a direct competitor or start their own business. If an employer suspects a departing worker has siphoned client databases or strategic plans to gain an unfair "springboard" advantage, they may rush to court to seek an interlocutory injunction. In Ontario, courts evaluate these urgent requests (often utilizing the RJR-MacDonald test) to determine if the employer will suffer irreparable harm if the former employee isn't immediately blocked from using the data. Because the line dividing an employee's permissible industry experience from an employer's guarded trade secrets is notoriously blurred and changes with every unique situation, obtaining tailored legal counsel is critical when navigating these disputes.
Frequently Asked Questions
What actually counts as confidential information in Ontario?
It typically includes non-public, proprietary assets that hold commercial value, such as trade secrets, unique software code, specialized client lists, and internal profit margins. It does not include public information or the routine skills and general industry knowledge you gain while doing your job.
Can my employer stop me from using skills I learned while working for them?
No. Under Ontario common law, your general skills, experience, and professional abilities belong to you. Your employer can only restrict you from using their specific, proprietary trade secrets and guarded data.
Do I still have to keep information secret if I never signed a written contract?
Yes. Even without a formal confidentiality agreement, Ontario employees owe an implied common law duty of fidelity. This means stealing or misusing true trade secrets or highly sensitive data to harm your employer is actionable in court.
How long does the duty to protect confidential information last after I leave a job?
Unlike restrictive covenants (like non-competition clauses) which must have strict geographical and time limits to be enforceable, the obligation to not exploit a former employer's true trade secrets can theoretically last indefinitely, or at least until the information becomes public knowledge.
Can my new employer be sued if I bring confidential information from my old job?
Yes. If a new employer knowingly receives or benefits from misappropriated trade secrets, they can be named in a lawsuit for issues like knowing receipt or inducing a breach of contract, and may face court injunctions limiting their business activities.
When should an employer reach out to a lawyer about suspected data theft?
Action should be taken immediately upon suspecting misappropriation. Delays can severely undermine an employer's ability to secure an urgent court injunction blocking the competitor's use of the stolen data.
Common Scenarios
- A senior sales executive downloads a company's meticulously curated master client list, complete with historical purchasing data and custom discounts, to a personal USB drive days before resigning to launch a competing firm.
- A software developer leaves a tech startup and attempts to integrate proprietary algorithms and source code they authored for their former employer into a new application they are building for a rival company.
- An HR director forwards highly sensitive employee compensation structures and unreleased corporate restructuring plans to their personal email account shortly before being terminated.
- A former manager mistakenly retains a company laptop and physical file boxes containing internal pricing strategies, prompting the former employer to pursue an interlocutory injunction to guarantee the items are returned without the data being copied.
What You Should Know
- Before your last day on the job, ensure that all company devices, physical files, and cloud storage accounts are fully surrendered to avoid unfounded allegations of data misappropriation.
- Employers should routinely audit data access, clearly labeling proprietary documents and employing password protections so that sensitive data is only accessible to employees who genuinely require it for their duties.
- If you are an employee transitioning to a competitor, avoid copying any templates, forms, or lists from your current employer, even if you created them yourself during working hours.
- Individuals moving into a highly competitive role in the same industry should have an employment lawyer scrutinize their transition plan to safely navigate the boundary between their transferable personal skills and the former employer's protected assets.
Featured Cases
C. v. W.
2026 ONCA 634 (CanLII) · 2026-09-10C. v. W.: Fiduciary Duties and Joint Ventures
This was an appeal to the Court of Appeal from a trial judge's decision dismissing the plaintiffs' claims and allowing the defendants' counterclaim for breach of contract. The employee and his company claimed breach of confidence, breach of fiduciary duty, and breach of a joint venture agreement regarding a research and development project, while the employer counterclaimed for negligent misrepresentation and breach of contract. The trial judge dismissed the plaintiffs' claims and awarded $1 to the employer on the counterclaim because the employee took work product when he resigned. The Court of Appeal upheld the dismissal of the plaintiffs' claims because they were employees and commercial parties with no joint venture or fiduciary relationship, but allowed the appeal on the counterclaim, dismissing it because the breach was not pleaded and there was no evidence of what was taken. The costs appeal was dismissed.
Cowan Insurance Group Ltd, v. B.
2026 ONSC 1413 (CanLII) · 2026-03-09Non-Compete Injunction Dismissed: ESA s. 67.2 Analysis
This interlocutory motion sought an injunction to prohibit a former employee from soliciting the plaintiff's clients, alleging breaches of restrictive covenants. The court dismissed the motion, finding that existing contractual and court-ordered restrictions were sufficient to protect confidential information, that the balance of convenience favored the defendant, and that the requested restraint was inconsistent with the prohibition on non-compete agreements under the Employment Standards Act, 2000.
B. v. M.
2025 ONSC 2365 (CanLII) · 2025-04-25Post-Termination Harassment & Confidentiality Injunction
This interlocutory proceeding addresses whether an injunction and Anton Piller order should be granted against a former employee who allegedly misused confidential information and harassed a senior executive after termination. The court applied the RJR-MacDonald test for injunctions and the Celanese test for Anton Piller orders, noting that the risk of irreparable harm is presumed in cases of misuse of confidential information. The case also considered Charter arguments regarding state action and awarded substantial indemnity costs due to the defendant's reprehensible conduct.
Arc Compute v. A.A., M.B. et al.
2025 ONSC 1745 (CanLII) · 2025-03-20Interlocutory Injunction: Fiduciary Duties & Non-Solicitation
An interlocutory proceeding involving departing employees accused of breaching fiduciary duties and employment contracts by misusing confidential information and soliciting clients. The court is determining whether to grant an injunction based on the test for serious issue to be tried, irreparable harm, and balance of convenience, while assessing the enforceability of non-solicitation clauses and confidentiality obligations.
Abaxx Technologies Inc. v. Pasig and Hudson Private Limited
2024 ONCA 164 (CanLII) · 2024-03-01Appeal Dismissed on Jurisdiction Over Former Executive
This is an appeal to the Court of Appeal from a motion judge's decision dismissing the action for lack of jurisdiction. The employer plaintiffs sued a former executive and related companies for breach of fiduciary duties, conspiracy, and misappropriation of corporate opportunities. The motion judge found that the plaintiffs failed to establish a real and substantial connection to Ontario, as the defendants were foreign and the relevant business occurred outside the province. The Court of Appeal agreed that the plaintiffs did not demonstrate a good arguable case for jurisdiction in Ontario. The appeal was dismissed.
R. v. Ecolab Co.
2023 ONSC 5995 (CanLII) · 2023-10-23Former Employee Breach of Confidence & Fiduciary Duty
This interlocutory proceeding addresses whether a former employee breached fiduciary duties and employment contract confidentiality obligations by retaining and attempting to use confidential documents after termination. The court rejected the plaintiff's argument that alleged employer misconduct negated the confidentiality of the documents and granted an injunction requiring the destruction of unlawfully obtained materials to prevent misuse of confidential business information.
Tar Heel Investments Inc. v. H.L. Staebler Company Limited
2022 ONCA 842 (CanLII) · 2022-12-05Insurance Broker's Book of Business and Tort of Conversion
This was an appeal to the Court of Appeal from a trial judge's decision in an action over an insurance broker's departure and transfer of client books to a new employer. The employer sued the broker and her new brokerage for conversion, breach of fiduciary duty, and other torts when she sold her client books to the new firm. The trial judge found she owned one book but not another, and awarded damages for conversion of the second book, declining to rule on the other claims. The Court of Appeal allowed the appeal and the employer's cross-appeal, finding the trial judge erred in his analysis of ownership and conversion of intangible property, and ordered a new trial on all causes of action.
Dymon Storage Corporation v. N.C.
2022 ONSC 5883 (CanLII) · 2022-10-18Non-Compete Covenant Enforceability in Employment
This interlocutory proceeding addressed the enforceability of a 10-year, Canada-wide non-competition clause in the defendant's employment agreement and allegations of misuse of confidential information. The court found the non-competition clause unreasonable due to excessive scope and duration, denying the injunction on that basis, while partially granting relief regarding specific confidential materials. Additionally, a stay of proceedings was granted in favor of arbitration for claims against the defendant.
Forward Signs Inc v. Philcan Group Inc.
2022 ONSC 5593 (CanLII) · 2022-10-03Injunction Not Extended: Fiduciary Duties & Unfair Competition
An interlocutory proceeding in Ontario involving an employer seeking to extend an interim injunction against former fiduciaries for unfair competition and breach of confidentiality. The court applied the Alberta Court of Appeal framework regarding the 'springboard effect' and determined that the plaintiffs failed to demonstrate a need for protection beyond one year, resulting in the injunction not being extended. Additionally, the court found no evidence that the defendants breached the existing injunction by soliciting customers or using confidential information.
Wellsky Corporation et al. v. M.
2022 ONSC 4124 (CanLII) · 2022-07-13Former Employee: Non-Compete Injunction Dismissed
This interlocutory motion involved a former employee accused of breaching fiduciary duties and misusing confidential information in violation of non-competition and non-solicitation clauses. The court applied the RJR-MacDonald test and dismissed the plaintiffs' motion for an injunction due to a lack of evidence regarding irreparable harm or the balance of convenience favoring the defendant.
Aware Ads Inc. v. W. et al
2021 ONSC 7452 (CanLII) · 2021-11-10Interim Injunction Denied: Restrictive Covenants
This is an interlocutory motion for an interim injunction brought by an employer against former employees who allegedly breached restrictive covenants by competing and soliciting clients. The court dismissed the motion for interim injunction, finding insufficient evidence to establish a strong prima facie case or irreparable harm, particularly regarding the misuse of confidential information and the enforceability of the non-competition clause.
DCR Strategies Inc. v G.
2021 ONSC 5404 (CanLII) · 2021-08-12Confidential Info: Injunction & Summary Judgment Dismissed
This is a procedural decision concerning an interlocutory injunction and summary judgment motions in a dispute involving confidential information. The court dismissed the plaintiff's motion for an interlocutory injunction due to a lack of evidence regarding irreparable harm and balance of convenience, and also dismissed a motion for summary judgment because material facts remained in dispute.
S. v Punjabi Community Health Services
2021 ONSC 991 (CanLII) · 2021-02-08Whistleblower Defence vs Confidentiality Injunction
This interlocutory motion addressed whether the employer was entitled to injunctive relief and a sealing order to protect confidential information allegedly misused by former employees. The court applied the R.J.R. Macdonald test for injunctive relief and considered the applicants' whistleblower defence, ultimately finding insufficient evidence of irreparable harm to justify the injunction.
Orpheus Medica v. Deep Biologics Inc.
2020 ONSC 4974 (CanLII) · 2020-09-21Injunction Denied: Breach of Employment Restrictive Covenants
This is an interlocutory proceeding where the plaintiff sought an injunction against defendants for alleged breaches of non-competition and non-solicitation clauses in their employment agreements. The court found that the plaintiff failed to establish the existence of valid and enforceable agreements due to evidence of fabrication, and further determined that the plaintiff did not demonstrate irreparable harm. Consequently, the balance of convenience favored the defendants, and the injunction was not granted.
Knowmadics v. C.
2019 ONSC 6549 (CanLII) · 2019-11-18Interlocutory Injunction: Breach of NDA & IP by Former Employee
This is an interlocutory proceeding regarding an injunction in a dispute involving a former employee and their former employer. The plaintiff alleged that the defendant breached employment and non-disclosure agreements by using confidential source code to develop competing software, raising serious issues to be tried. The court granted an injunction limited to the Canadian market and existing clients, and ordered an accounting of revenues, while declining to order payment into court.
Pioneering Technology Corp. v. C. et al.
2019 ONSC 3278 (CanLII) · 2019-05-28Fiduciary Duties & Injunctions: Former Employees
This interlocutory motion involved former employees and a contractor seeking to pursue competing business ventures, raising issues regarding the use of confidential information and breach of fiduciary duties. The court applied the RJR MacDonald test for interlocutory injunctions and Canadian Aero Service principles regarding fiduciary obligations. The motion was dismissed because the plaintiff failed to establish irreparable harm or satisfy the balance of convenience.
2298679 Ontario Inc. et al. v. Northern Homecare Solutions Inc. et al.
2019 ONSC 3055 (CanLII) · 2019-05-17Interim Injunction: Former Employees & Confidential Info
This is an interlocutory proceeding where the plaintiff sought interim injunctive relief and Anton Piller orders against former employees accused of breaching confidence and committing injurious falsehood by misusing confidential customer lists. The court denied the Anton Piller order as overly intrusive but granted a ten-day interim injunction, finding a serious issue to be tried and irreparable harm to the plaintiff's goodwill.
Shaver-Kudell Manufacturing Inc. v. Knight Manufacturing Inc., et al
2018 ONSC 5206 (CanLII) · 2018-08-07Former Employee Misappropriation of Trade Secrets
This case addresses whether a former employee breached her duty of confidence and good faith by misappropriating trade secrets and customer lists. The court found that the manufacturing processes and tooling constituted trade secrets and that the defendant's use of memorized customer information for a competitor established a breach of confidence.
OIBC v. K.
2018 ONSC 4612 (CanLII) · 2018-07-31Employment Contract: Restrictive Covenants & Fiduciary Duties
This is a summary judgment motion involving a former employee and their former employer, addressing claims related to restrictive covenants, fiduciary duties, and misuse of confidential information. The court granted summary judgment in favor of the defendant, finding no genuine issue requiring a trial because the signed employment contracts lacked restrictive covenants, the employee did not owe fiduciary duties due to a lack of management responsibilities, and the customer information did not qualify as confidential.
Energy Efficient Lighting Ltd. v.Chan
2018 ONSC 2252 (CanLII) · 2018-04-06Injunction Dismissed: Confidential Info & Solicitation
This is an interlocutory motion for an injunction where the plaintiff sought to prevent former employees or associates from using confidential information and soliciting customers. The court dismissed the motion, finding the plaintiff failed to establish irreparable harm or that the balance of convenience favored them, noting the defendants faced potential financial ruin if the injunction were granted.