"Springboard" Injunctions in Singapore

A “springboard” injunction is an injunction taken out by a company to prevent its employees from joining a competitor until a certain time has passed. Its purpose is to prevent the company’s competitor and ex-employees from “springboarding” ahead by breaching their contracts of employment to obtain a competitive advantage.

The “springboard” injunction was granted as early as 1960 in the English case of Terrapin Ltd v Builders Supply co (Hayes) Ltd [1960] RPC 128. Originally, it arose from the fear that the employees or competitor would misuse confidential information gained from the plaintiff company and was limited to such cases.

However, the English courts have since granted “springboard” injunctions even if there is no misuse of confidential information. (See: UBS Wealth Management (UK) Ltd v Vestra Wealth LLP [2008] IRLR 965 and CEF Holdings Ltd and another v Mundey and others [2012] IRLR 912.)

In contrast, the courts in Australia and Hong Kong have not extended the granting of “springboard” injunctions beyond instances of a misuse of confidential information. (See: ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd & Others [2005] FCA 130; and ICAP (Hong Kong) Ltd v BGC Securities (Hong Kong) LLC & Ors [2005] 3 HKC 137.)

In its recent decision in Jardine Lloyd Thompson Pte Ltd v Howden Insurance Brokers (S) Pte Ltd [2015] SGHC 202, the Singapore High Court had the opportunity to consider whether to grant an interim “springboard” injunction against the plaintiff’s employees and the first defendant, the plaintiff’s competitor, where there was no misuse of confidential information.

The Singapore High Court followed the Australian and Hong Kong position and declined to grant the “springboard” injunctions requested. The learned judge also held that even if he agreed with the broader English approach, he would not have granted the “springboard” injunction, as he was not satisfied that there was clear evidence of an unlawful plan to poach both staff and clients.

Given that there has not been any appeal against the learned judge’s decision in Jardine, the Singapore position is currently the same as that in Australia and Hong Kong—i.e., an employer will need to show misuse of confidential information before a “springboard” injunction will be granted.

Nevertheless, given that the Australian and Hong Kong decisions relied on by the learned judge in Jardine were made in 2005, compared to the latest English decisions, which were made in 2012, the possibility exists that the legal position may change if a subsequent case comes before the Singapore Court of Appeal.

In the meantime, employers seeking “springboard” injunctions likely will still need to show that there has been misuse of their confidential information.

Written by Wei Chern Tham.

Please contact Wei Chern Tham at wctham@selvam.com.sg for more information.

The content of this update is of general interest and is not intended to apply to specific circumstances. The content should not therefore, be regarded as constituting legal advice and should not be relied on as such.