You’ve been diligent about locking away your most sensitive documents in the
filing cabinet each night, and encrypting all of your electronic files with passwords,
but what about the information that is shared among employees on a daily basis?
Do you have a non-disclosure
agreement in place? When do you need one? A non-disclosure agreement governs
the relationship between you and any existing or potential business associates or
employees. It is typically recommended that this type of agreement is used prior
to entering into any negotiations, interviews or other situations in which confidential
information or materials are exchanged.
The safeguards of a non-disclosure agreement
A non-disclosure agreement clearly defines conditions, between you and a business
associate, for exchanging and using confidential information and materials. It also
requires that parties involved keep sensitive information confidential, outlines
resolutions for agreement violations, and calls for arbitration in the event a dispute
regarding violations arises.
The non-disclosure agreement is essential for keeping information protected, and
should be implemented anytime confidentiality is imperative. These agreements are
most suitable in situations in which information sharing between two parties is
necessary, but it needs to be kept confidential from the general public. The number
of scenarios in which a non-disclosure agreement can serve as a vital tool, varies
widely. One instance is when
network solutions or software
is provided, or intellectual
property is shared. In this case there are specific non-disclosure contracts
for IT consultants. For those working in the information technology field, these
agreements are necessary for nearly any business relationship.
What should the agreement contain?
Generally, most non-disclosure agreements should include information about the parties
involved, any clauses that might be incorporated, and what information should be
kept confidential. If either party should break the agreement, legal actions can
be taken. The purpose of the non-disclosure agreement, though, should be to avoid
litigation. If both parties follow the non-disclosure agreement, things will run
smoothly and the agreement will serve its purpose. Agreements, and provisions within
the agreements, will vary based on the industry, the persons involved and the information
that is to remain confidential.
Non-disclosure contracts for IT consultants can differ significantly from
agreements written for financial institutions. Some provisions might include:
- Confidential Material
- Use and Treatment of Confidential Material
- Return of Confidential Material
- Employee Solicitation and/or Hiring
- Arbitration and Attorneys' Fees
- Waiver and Modification
To better understand what agreements should contain, review non-disclosure agreement
samples. This will help you determine what you might need to include in your contract.
Before sharing information contained within unpublished patent applications, financial
statements, or business strategies, you should be sure a non-disclosure agreement
has been agreed upon and signed by all parties involved. This will provide legal
safeguard on all confidential information and prevent others from stealing information.
To ensure all of the vital components are included within the agreement, review
non-disclosure agreement samples as you can, and utilize a non-disclosure
agreement template produced by a credible company, then have a professional attorney
review all of your documents. Taking these steps can save you time and protect you
from potentially costly litigations.
Look online for resources
For many entrepreneurs new to navigating the world of small business ownership,
paying for an attorney may be out of the question. Online resources are a cost effective
and useful way to obtain knowledge on non-disclosure agreements. You can also utilize
non-disclosure agreement templates
to get your contract in place and be sure it meets industry standards.