This essay analyzes and critiques the Restatement of Employment Law’s provision on the duty of loyalty. Cases invoking the duty of loyalty have generally been successful only in the limited circumstance when an employee leaves her current employment to start a competing business. The Restatement, however, reconceptualizes the duty of loyalty claim into a catch all provision that could be used to restrain employees from moving to competitors, even in the absence of a noncompete agreement, and to protect trade secrets or confidential information. The expansion of the duty of loyalty cause of action is unsupported by either the existing case law or the support cited with the Restatement itself; indeed the cases the Reporters provide do not generally involve the duty of loyalty claim at all. Even more troubling, the expansion of the duty of loyalty claim is neither explained nor justified within the document but instead seems to be based on a desire to offer employers greater means to protect their assets.
GW Paper Series
GWU Legal Studies Research Paper No. 2013-64; GWU Law School Public Law Research Paper No. 2013-64
Michael Selmi, The Restatement's Supersized Duty of Loyalty Provision, 16 Employee Rts. & Emp. Pol'y J. 395 (2012).