By their nature, most tech companies possess confidential information or trade secrets. These trade secrets may be your company's very livelihood, or they may be a key component in your business model. For that reason, another restrictive covenant that you will likely want to include in your employment agreements is a non-disclosure, or confidentiality, provision.
Non-disclosure provisions protect your business from the disclosure of certain valuable information, such as trade secrets, after your employee leaves. For example, you may permit certain employees access to information about your secret invention, method, design, idea, or formula – the disclosure of which to your competitors would seriously harm your business and its profitability. In addition, some courts have even recognized client lists or other data compilations as a protectible interest, depending on how they were generated and maintained.
Some considerations for non-disclosure provisions: How do you define "confidential information"? Are there any exceptions to what cannot be disclosed? Is there a time limitation for the non-disclosure? Although non-disclosure agreements are typically enforceable, they need to be appropriately tailored to address information that merits protection. And as with any agreement, it's wise to seek trusted legal advice to craft an agreement that protects your business in the strongest way possible under applicable law.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
