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What does it mean when you sign a nondisclosure agreement?

A nondisclosure agreement is an important part of many business contracts. It prevents employees from being able to discuss specific things that they learn during their course of employment. If you break the terms of the nondisclosure agreement, legal consequences can occur.

There are some basic points that must be included in the contract in order for it to be considered legally valid. The terms lay out the expectations for the employees so that there isn’t any doubt about what they’re allowed to reveal to others and what they need to keep confidential.

What terms have to be included in the nondisclosure agreement?

While there may be additional terms added to an agreement, there must be a minimum of the five outlined below:

  •       The name of the employee and the company
  •       What information is covered by the contract
  •       How the person can use the covered information
  •       Any exclusions from the terms in the contract
  •       The time period the contract is valid for

Other terms can be included in the contract. This can include things like how a breach of the contract is handled and who will be responsible for legal fees if the contract is broken.

Any employee who’s asked to sign a nondisclosure agreement should ensure that they understand all the terms of the contract. Having it reviewed before signing it is beneficial. If you’re being accused of breaching the nondisclosure agreement, you need to take steps to protect yourself. Learning your options is important, so be sure you have someone on your side who can assist you with this. 

 

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