Print this Article
Adapted from an article by Dayan Dovid Grossman | Rosh Bet HaVa’ad, Lakewood
Jobs often involve much more than the plain job description. Over the course of one’s employment they will build relationships, be entrusted with confidential information, and hold positions of power and importance to others. We must inquire, what rights does an employee have to benefit from these assets according to Halacha.
The Gemara[1] rules that an employee’s earnings during working hours, in many cases, belong to the employer, following the rule of “yado k’yad ba’al habayit” – the “hand” of an employee becomes the “hand” of the employer. There are many applications of this Halacha, some of which we will discuss in this article.
Competition and Company Leads
One common issue often surfaces upon the termination of a typical employment relationship. The parties are often faced with questions as to what are the employee’s rights to continue operating in the same field as their former employer and whether or not the former employee may make use of previous contacts acquired during his terminated employment.
Many employees feel that they should be able to continue to service clients that they have invested time and effort to obtain and maintain. The employer’s position might be that the clients are theirs, since they were obtained while the employee was working for the company.
As a matter of Halacha, unless a valid non-compete agreement was executed prior to the commencement of the relationship, which limits the employee’s ability to compete with the company upon his employment’s termination, it is usually permitted for a former employee to compete with his former boss in accordance with the general rules of competition that apply to the rest of the market.
However, with regards to leads and customers which were generated while working for the previous company, there would be a Halachic issue for the employee to solicit clients to follow him to the new job. Since these relationships were cultivated and nurtured on the former employer’s “dime”, the rule of “yado k’yad ba’al habayit” dictates that these relationships are considered to be the company’s property and the employee would therefore not be able to take them with him when they leave.
Only with regards to specific accounts which can be directly accredited to the employee – such as a relative or close friend of the employee – may there be grounds for the employee to be entitled to continue pursuing those clients.
Loyalties, Royalties, and Kickbacks
Whenever an employee is acting as an agent or put into a position of authority to make decisions on behalf of his employer, it is important to ensure that those decisions are made solely to represent the best interests of the employer, without letting any other considerations influence the decision. Therefore, one must be very careful when offered any type of perk or kickback, by potential customers, clients, or vendors, in an attempt to “earn” the company’s business. After all, the employee is being paid to look out for the best interests of the company. Taking personal benefit into consideration will inhibit him from doing that job correctly, thus putting in question the permissibility of taking his salary.
In addition, many times, when a specific vendor is offering a kickback, the added “expense” inhibits the vendor from offering the company any type of reduction or discount which they would typically offer the average buyer. Thus the employer’s interests are further compromised.
Furthermore, by allowing one’s decision to be influenced by a potential perk, the employee may be transgressing the prohibition of “Lifnei ‘Iver Lo Titen Michshol”[2] – do not place a stumbling block before a blind person – which includes the prohibition of giving an “etza sh’eina hogenet”; unsuitable advice. Rashi quotes Hachamim in Torat Cohanim[3] expound on this stating: “lest you justify yourself and claim that you are genuinely giving good advice, behold the [truth] is in the heart, as the verse says [following the prohibition of placing a stumbling block] ‘V’Yareta Me’Elokecha – and you should fear your God [who knows the truth in your heart]’”. The Torah even issues a harsh curse over the head of one who misleads the blind[4].
Another prohibition which would apply to one who is taking kickbacks that may impair his ability to seek out his employer’s best interest is that of “Lo Tikah Shohad”[5] – do not take a bribe. The prohibition of taking a bribe in its simplest form is directed towards the Dayanim – judges in a Din Torah. However, the Poskim understand this prohibition to include anyone who has been put in an authoritative position to make decisions for, or in relation to others.
As the Pilpula Harifta[6] writes: “…. I write this as an instruction to those that have been placed in a position of authority over the general population, even though their decisions are not [involving] Din Torah, and they were not appointed for that reason, they should be careful not to accept presents that may affect their decisions…”
As a general rule, any perk or kickback that one feels they must hide from their boss is likely one that should not be received. One should disclose such an offer to one’s boss or at the very least speak it over with a competent authority in Hoshen Mishpat – Jewish monetary Halacha – before accepting such an offer.
Sources:
[1] ב”מ י”א ע”א
[2] ויקרא יט, יד
[3] פ”ב, יג
[4] דברים כז, יח
[5] דברים טז, יט
[6] סנהדרין פ”א