Employees at Conferences & Trade Fairs

Industry Conferences, Trade Fairs, and other Business Events: Attendance of Employees and Employers by Bruce Leonard Beal, Esq.

Attendance at industry conferences, trade fairs, and other business events can be rewarding to both employees and employers.  These events provide buying/selling opportunities and a learning environment where employees may learn about market conditions, industry product standards, potential vendors and customers, and promotional ideas. 

Employers should also know that there are substantial risks involved in having employees attend these events.  Reasonable risk management tools are available to minimize these risks. 

Risks increase when alcohol is added to the mix.  Since alcohol impairs judgment and decreases inhibitions, employees are more likely to discuss items which cross over into the risk areas, below.  As a consequence, only trusted employees should attend these events, and firm policies regarding the consumption of alcohol should be implemented. 

To give you some perspective on the risks, some firms have a policy against their employees attending these events.  While this might protect the firm, with the development of proper policies, a firm may also avail itself of the benefits, while minimizing the risks, of attending such events. 

The remainder of this article briefly describes the risks and the policies that should be put in place to minimize these risks.  Any employee who is scheduled to attend a convention or similar event for the first time should be made aware of these risks and policies. 

Antitrust laws were established to promote and protect competition.  Activities that limit competition in a market may violate the law and may expose firms to civil and criminal liability and penalties, including monetary damages, fines and even imprisonment.  Antitrust laws can be violated on the golf course, as well as over the desk telephone. 

Activities that may be prohibited by the antitrust laws include price fixing, bid rigging, dividing markets, boycotts, tying agreements, exclusive dealing, refusal to deal, joint purchasing, reciprocal dealing, and exchanging competitively sensitive information that is not publicly available with competitors.  More detailed discussions of these actions may be obtained from corporate counsel. 

From a policy standpoint, your employees should not, without legal advice, discuss prices, terms, costs, territories, marketing plans or other competitive information with competitors or groups of suppliers, discuss strategic partnerships or similar with competitors, or condition your firm’s purchases from a supplier on an agreement to buy your firm’s products. 

Conflicts of interest arise between a firm and its employees, when an employee has a personal interest in a corporate transaction.  This most often occurs when employees receive gifts from vendors and customers and is quite common at these events. 

From a policy standpoint, employees should not give or accept gifts or anything of value that improperly influences or appears to influence a business decision.  Common exceptions are hospitality and small value gifts that are customary and proper under the circumstances, if not repetitive, nor place the employee under any obligation. 

Proprietary information is confidential and valuable business information.  Trade secrets, such as the formula for Coca-Cola, are perfect examples.  Disclosure of proprietary information to competitors is very damaging.  Events are perfect forums for unintentional disclosure of such information, especially when alcohol and bragging rights are involved. 

Your firm should already have in place policies for protection of proprietary information, including use of nondisclosure agreements signed by employees possessing such information.  Employees going to events for the first time should be reminded of such policies and/or agreements and perhaps should sign a nondisclosure agreement, if not signed previously. 

Losses of employees occur at such events, which provide an ideal forum for competitors to offer employment.  California law invalidates non-compete agreements, which prohibit an employee from working for a competitor, unless necessary to protect your trade secrets and reasonably limited in time and scope.  Legal advice in these regards is indicated.  Send only trusted, loyal employees to conventions, if they are indispensable to your firm. 

Commercial defamation and trade disparagement arise when false or misleading factual representations are made about the nature, characteristics or qualities of a competitor’s products or services.  When this occurs, a competitor might consider bringing a claim against your employee and firm.  Violations, if proven, would entitle your competitor to your profits and its damages, costs of the action, and up to treble damages. 

Conventions are fertile grounds for misrepresentations to vendors and customers about competitors in the push to sell products and services.  Since truth is always an absolute defense, employees going to conventions for the first time should be counseled to always be truthful in factual representations concerning other competitors.  While opinions are not subject to the same liability, the distinction between facts and opinion need to be clearly understood. 

Personal injuries may occur at these events.  If your employee attends and injures someone, whether consuming alcohol or not, and your firm may be liable for any tortious act committed by your employee acting within the “scope of employment”. 

Employee attendance at a business event is usually within the scope of employment, unless an employee leaves the event premises and pursues purely personal matters.  Between these two extremes lies a large grey area into which judges and juries inquire and decide. 

Workers compensation may apply at events, when an employee sustains injury or death, if it is “within the scope of employment”; however, your firm has no liability, if the proximate cause of the injury or death is alcohol or drug intoxication.

From a policy standpoint, your firm may want to implement an alcohol policy, ranging from prohibition of alcohol during events to requiring consumption of food while drinking and limiting the number of drinks. 

In summary, if your firm sends employees to outside business events, it should have appropriate policies in effect.  Employees attending events for the first time should be first counseled in the risks and policies, and any related agreements signed.  Send only trusted and loyal employees.

Thank you for the notes…  I like all the thoughts you added about the employment agreements.  Thanks again for all your help."

Who We Are:

Image of Bruce Leonard Beal

The present firm arose from Bruce's move from the Los Angeles area to Dana Point, where he and his wife wanted to live since they first  discovered it. 

Bruce comes from the Senior Counsel position in a large world class international technology, engineering and construction corporation with thousands of employees, hundreds of large clients, world class projects, hundreds of affiliates, and complex transactions and litigation.  Before that, he gained significant major law firm experience, including arguments before state appellate and supreme courts.

His desire in moving to Dana Point was and still is to bring his world class experience to smaller and emerging businesses in the area.  This experience produces more valuable legal and business judgment from him than is available from newer attorneys or attorneys whose practices are more specialized and localized.  His extensive Resume is here Résumé.

Marlene wears all hats other than "Lawyer" in the firm,  including Paralegal, Marketing, Accounting, and Office Management and Assistance. Her extensive Resume is here Résumé.

Disclaimer: The purpose of this article is to provide information, rather than advice or opinion. It is accurate to the best of my knowledge as of the date of the article. I have no duty to update this article. The information, examples and suggestions presented in this article have been developed from sources believed to be reliable. This article should not be viewed as a substitute for the guidance and recommendations of a retained professional and should not be construed as legal or other professional advice. In addition, I do not endorse any actions addressed herein, unless they are produced or created by me.  I recommend consultation with me or other competent legal counsel and/or other professional advisors before applying this material to any particular factual situations.