The Do’s and Don’ts of Nondisclosure Agreements

The Do’s and Don’ts of Nondisclosure Agreements

As part of our series on how to draft and implement an effective employee handbook, we’re going to explore the necessities of a nondisclosure agreements. This component can be a tricky one, especially if your business is known for its high turnover rates. However, the truth is, every business has some proprietary and confidential information that needs to be protected. Therefore, in addition to securing your operation with an Orlando Employment Practices Liability insurance policy, consider these do’s and don’ts for writing nondisclosure agreements.

The basics of nondisclosure agreements.

According to Legal Zoom, a confidentiality agreement signed at the start of an employment relationship alerts a prospective employee that your company considers this a tremendously important matter. By signing the agreement, the employee acknowledges that the disclosure of confidential information is a breach of his or her employment contract, a fact that has serious and wide-ranging consequences. Moreover, the agreement’s existence allows the parties to enter into an open discussion about company business.

Before the employee signs the nondisclosure agreement, it’s vital that you allow the time for questions to be asked and answered so there is no misinterpretation of the boundaries.

The Do’s and Don’ts.

  • DO allow plenty of time for the employee to read, understand, and ask questions about the nondisclosure agreement.
  • DO renew the nondisclosure agreement when an employee receives a raise, a bonus, or a job title change.
  • DO sign two copies of the agreement so that both you and the employee have it on file.
  • DON’T let these policies be forgotten over time – hold an annual meeting to go over important policies and procedures.
  • DON’T skip the exit interview. When an employee quits, conduct an exit interview to remind them of their legal obligation to your business and its confidential information.

About Newman Crane & Associates Insurance

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