No breach of duty of loyalty by the employee in founding a sole proprietorship during an unnoticed employment

Facts

H. J. was employed as an organizer at B. AG since September 1, 1987. On November 14, 1988, he founded the sole proprietorship Data Consulting J. with the field of activity "consulting on, training for and mediation of IT solutions". On November 25, 1988, J. was dismissed without notice. The Cantonal Office for Industry, Commerce and Labor (KIGA), Department of Unemployment Insurance, then sued B. AG for the payment of CHF 12,838.20, which J. had received as unemployment benefits. The President of the Court and the Court of Appeal of the Canton of Bern upheld the claim, as they saw no breach of duty of loyalty by J. that would have justified the dismissal without notice.

Considerations

According to the Federal Supreme Court, an employment relationship can only be terminated without notice for good cause if it is no longer reasonable for one party to continue the contract. A misconduct requires that the employee has either violated his or her work obligations or his or her duty of loyalty.

The Federal Supreme Court concluded that J. had fulfilled his work obligations and had not violated the legitimate interests of B. AG. While an employee may prepare for a future self-employment during an existing employment contract, he or she only violates the duty of loyalty if the preparations are contrary to good faith, such as if he or she begins to…