Human resource departments deal with a number of private and legal issues for both the company and employees, but for confidentiality agreements, also called non-disclosure agreements (NDAs), it is a good idea to enlist the help of an attorney with specialized knowledge in this specific area. When it comes to a company’s private information, it is necessary to proactively protect it, and a reputable attorney can ensure that you have the correct measures in place for a non-disclosure agreement.

What Are Confidentiality Agreements?

It is not uncommon in today’s business world for employers to ask their employees to enter into some form of a confidentiality agreement or NDA, especially when information travels infinitely faster via email and social media than by word of mouth. Essentially this agreement is a document outlining specific measures designed to safeguard against the sharing of information.

Some items that may be included in an employer’s non-disclosure agreement include information regarding business strategy, product development, intellectual property and patents, financial information, or client lists.

Who May Be Asked to Sign a Confidentiality Agreement?

From a human resources standpoint, confidentiality agreements are typically geared toward the following entities:

  • Existing employees
  • New hires
  • Contractors
  • Consultants
  • Third Party Vendors

Most often, employers implement this type of agreement at the time of hiring, however it can be done at any time of the company’s choosing. If an employer is asking one of the above entities to enter into an NDA, it is considered best practice to give them a specified window of time to thoroughly review before signing.

How Confidentiality Agreements Work

Depending on the company and the exact purpose of a confidentiality agreement, these documents can vary, however, most focus on the following components in some form or another:

  • A presented agreement should have all involved parties sign, including the employer and the employee.
  • Protection of information. The document should not be a general blanket statement but rather be a thorough, itemized list of exactly what information the agreement protects.
  • Exceptions to the rule. There may be certain situations in which sharing company information may be allowed. It is critical to be very specific as to what these situations might be, and if they occur, how the information may be shared.
  • Termination and property. It has become commonplace upon the termination of an employee that their work-related materials such as electronic and physical files, hardware, software, and other tangible materials be returned to the company. Commonplace or not, employers should take care in the agreement to specify exactly what is expected in terms of returning property upon an employee’s termination.
  • Employers that wish for a confidentiality agreement to extend beyond an employee’s termination should incorporate that sentiment into the wording of the document.
  • Employers should take care to state the potential consequences if an employee intentionally or unintentionally violates the non-disclosure agreement.

Confidentiality agreements vary in length, with some being short and to the point and others providing an extensive itemized list of expectations. An attorney can help an employer decide which is best for their needs.

Why It Is Key to Be as Specific as Possible When Drawing Up a Confidentiality Agreement

A company may think it better to include a broad clause in a confidentiality agreement indicating that an employee should not share any product or sensitive information with outside parties, however, this would be a mistake. When implementing this type of document, it is essential to be as specific as possible.

The driving force behind the need for detail is the risk of being too broad. A non-disclosure agreement that covers a great deal of information without being specific may be deemed as invalid or unenforceable by a court of law, which can render the entire document as ineffective.

How An Attorney Can Help Employers with Confidentiality Agreements

Due to the sensitive nature of some confidentiality agreements and the amount of detail that should be involved, it can be a good idea to hire an attorney who specializes in this area to assist. While an employer is usually the expert regarding what type of information needs to be protected, an attorney will be more knowledgeable about the legal aspects of a non-disclosure document.

A reputable attorney should offer a unique skill set, including the following:

  • Intimate knowledge of state laws regarding confidentiality agreements and NDAs
  • Ability to use solid legal language that will stand up in a court of law
  • Heightened awareness of what a court looks for in valid NDAs
  • Guidance in the signing, copying, and storing of agreements

An attorney who helps draft a confidentiality agreement is also intimately familiar with the details listed within, making them a natural choice should an employer need legal representation for an employee’s breach of that agreement.

Don’t take the importance of confidentiality agreements lightly. Be sure to choose a reputable attorney to advise you before drafting or signing an NDA.