I. Introduction

Pursuant to § 60 para. 1 HGB, a clerk (“Handlungsgehilfe”) may not carry on a trade or conduct business in the principal’s trade for his own account or for the account of a third party without the principal’s consent. This statutory non-competition clause also applies to all other employees for the entire legal duration of their employment relationship.
A breach of the non-competition clause results in the employer being entitled to claim damages from the employee pursuant to § 61 para. 1 HGB or to demand that the employee return the remuneration received from the transactions. In addition, the employer may demand information about the transactions concluded by the employee or claim injunctive relief against the employee. In addition, breaches of non-competition by the employee during the ongoing employment relationship are classified as so serious that they regularly constitute good cause for termination without notice within the meaning of § 626 German Civil Code (Bürgerliches Gesetzbuch – BGB) without prior warning.
It should be noted, however, that claims for compensation or return of remuneration are subject to the short limitation period of § 61 para. 2 HGB. According to this, such claims by the employer become time-barred three months after the date on which the employer became aware or should have become aware of the conclusion of a competitive transaction. In the aforementioned ruling, the BAG has now decided that the three-month limitation period under § 61 para. 2 HGB also begins to run irrespective of the conclusion of an individual commercial transaction if the employer has become aware or should have become aware that the employee is operating a competing commercial business, in particular because he maintains an Internet presence.

II. Facts of the case

The employee (defendant) was employed for many years by the employer (claimant), whose business was the manufacture and sale of bandages and brake leathers for industrial use. In the summer of 2010, he founded a limited liability company of which he was the majority shareholder and sole managing director. In the commercial register, the object of the company was entered as “trade with technical leather articles”. The employee subsequently engaged in competitive activities, for example by invoicing the supply of bandages via the GmbH, although these were orders from the employer. In June 2013, an auditor commissioned by the employer checked the facts of the case and came across the website of the GmbH. When asked by the employer, the employee stated that the GmbH was currently only selling jewelry. Consequently, the employer assumed that the employee was not engaged in any competitive activity. It was not until September 2013 that the employer learned from one of its customers during a telephone call that the defendant was engaged in competition. In a lawsuit filed in November 2013, the employer asserted a claim for information and damages against the employee on the grounds of a violation of the statutory non-competition clause. In the lawsuit, the employee alleged that the claims would be time barred because the GmbH had already been advertising competing products on its website since July 2012.

III. Reasons for the decision

The BAG dismissed the appeal against a judgment rejecting the employer’s claims as unfounded. The claims for information and damages asserted by the employer by way of a step action had arisen on the merits due to anti-competitive actions of the employee within the meaning of § 60 para. 1 HGB. However, they were precluded by the employee’s plea of limitation pursuant to § 61 para. 2 HGB. The beginning of the limitation period would not be solely determined by the employer’s knowledge or grossly negligent lack of knowledge of the conclusion of a specific transaction by the employee. Instead, the provision should be interpreted beyond its wording to the effect that knowledge or grossly negligent ignorance of the operation of a competing commercial enterprise would be also sufficient. This would be supported in particular by the fact that the three-month limitation period was intended to ensure that claims by the employer arising from a breach of the statutory non-competition clause can be settled quickly.
In the opinion of the BAG, the decisive connecting factor for the start of the short limitation period was, in addition to the contents of the commercial register, the website of the GmbH. This had in any case been publicly accessible since June 2013, so that at the latest by the end of June 2013 there had been grossly negligent ignorance on the part of the employer of the operation of a competing commercial enterprise. The employer could not argue against this that the internet presence constituted a permitted preparatory act. It would be true that the employee may prepare the establishment of his own company or the change to a competing company for the time after leaving the company even before the termination of the employment relationship. In the case of an Internet presence, the mere acquisition and construction of a website would therefore to be classified as a permitted preparatory act, provided that the Internet domain was not yet publicly accessible. However, the threshold of a permitted preparatory act would be exceeded if the employee, as in the present case, carried out an external advertising activity. This would be the case if the website can be visited by anyone and products belonging to the portfolio of the competitor company are advertised on it. The Internet presence would then to be classified as the operation of a commercial enterprise within the meaning of § 60 para. 1 HGB. The limitation period therefore began to run at the end of June 2013 and the action for disclosure served in December 2013 could no longer suspend the limitation period, which had already expired.

IV. Consequences for the practice

At three months, the surprisingly short statute of limitations under § 61 para. 2 HGB has always proved to be a threat to the assertion of claims for damages for breaches of competition by employees. The ruling of the 10th Senate has further exacerbated this situation. The BAG justifies its decision by stating that the employer is sufficiently protected against the occurrence of the statute of limitations for its claims by the possibility of a step action for information and damages. In practice, an employer who has evidence of competition by his employee will regularly focus on sanctioning the infringement by terminating the employment relationship without notice. As a rule, however, the employer cannot obtain the necessary knowledge about the existence of sufficient grounds for termination, or at least not in time, by means of an action for information. The decision that a mere Internet presence can be sufficient to establish the operation of a competing commercial enterprise within the meaning of § 60 para. 1 HGB and thus trigger the short limitation period for claims by the employer further restricts the employer’s ability to take action against the employee in the event of a breach of the statutory non-competition clause. This is because the employer will often hesitate to assert claims in court as long as it is unclear whether there has been any significant competitive activity at all or whether he has suffered significant damage as a result. If the employer has finally ascertained the necessary findings with sufficient certainty, the employer will, according to the case law of the BAG, often have to accept the employee’s plea of the statute of limitations.
Employers are therefore advised to take action as soon as possible if there are indications that an employee is engaged in prohibited competitive activities and to suspend the short limitation period of § 61 para. 2 HGB, e.g. by filing a step action for information and damages.