What Does the Ideal Confidentiality Agreement Look Like?
Many companies use confidentiality agreements to protect important information. They have new employees sign these documents in order to keep information safe and secure. With the right protections in place, companies can hire employees and vendors without fear.
However, if the agreement is drafted improperly, it offers little to no legal protections.
Confidentiality agreements are simply pieces of paper, and as much, they can only do so much. They cannot prevent a party from disclosing your company’s information, but they do allow you to sue someone who does. That’s why you should give your information only to those you trust.
What elements should be included in your confidentiality agreement? Read on to find out how to best keep your precious information safe with such a document.
Key Elements of a Confidentiality Agreement
Your main priority should be to prevent not only disclosure of the information, but use of it as well. You don’t want an employee, vendor or customer to steal your ideas and pass them off as their own. This happens quite often, especially when disagreements occur and the employee steals the information as part of revenge.
You should ensure that you define what information is to be protected. It’s better to be safe than sorry, so be detailed as to what the agreement shall cover.
The duration should also be clearly defined. How long should the agreement last? When can the party disclose information? This period of time should be in the confidentiality agreement.
You should not have any obligation to the party receiving the confidentiality agreement. In order to get full disclosure, you should not owe anything to the employee, customer, vendor or other party in return.
Finally, what is your enforcement plan? If the party discloses the information despite having signed the agreement, this is considered breach of contract. Will you fire the employee? Will you take legal action? Make it clear what happens in the event of an information breach.
What to Consider
There are two types of confidentiality agreements to consider: mutual and non-mutual. Most agreements are non-mutual, meaning they are one-sided. This most often refers to a company sharing trade secrets and confidential information with a new employee or vendor. Mutual agreements are used when both sides have confidential information to share with each other. This may occur when one company merges with another.
Also, be sure you can trust the person before giving him or her a confidential agreement to sign. Perform background checks and check out references before hiring. While most people are honest and trustworthy, some are not.
Learn More About Confidentiality Agreements
A confidentiality agreement can protect your business and keep your trade secrets safe for years to come. Each situation is unique, though, and you need a document that meets your company’s specific requirements. Don’t rely on a basic template.
Orlando nondisclosure and confidentiality agreement lawyer B.F. Godfrey from Godfrey Legal has decades of experience helping business owners create confidentiality agreements that have the legal protections they need. Contact Godfrey Legal at (407) 890-0023 today for a consultation.