N.D.A., the commonly used abbreviation for Non-Disclosure Agreement, is a contract between two or more parties to not share information exchanged between them for a particular purpose and usually for a particular time frame. Most businesses utilize the benefits of an NDA on a regular basis. Businesses often enter into NDAs to protect the exchange of information between customers, vendors, and even for purposes of giving or receiving sales presentations.
The various NDAs in place can protect the confidential information from use directly by competitors and vendors, however, often a business overlooks having strong NDAs in place between its employees and independent contractors. It is often a good idea to have a solid NDA in place with all employees and independent contractors prior to them beginning to perform any work or receive any confidential information.
The NDA with an employee or independent contractor should provide a simple and succinct definition of what information is deemed confidential and is being sought to be protected and should be as specific as possible. Often times, the more specifically the confidential information is defined and the more it can be shown that the business that is seeking protection of confidential information has a legitimate reason to do so, the more likely that a court will enforce the agreement in favor of an employer.
Some businesses believe that because it entered into an NDA with each employee or independent contractor at the date of hire they are adequately covered. Illinois courts generally require that agreements seeking protection of confidential information of former employers or independent contractors be reasonable and not overly broad. It is always a good idea to review prior agreements to ensure that the language used to define confidential information is not overly broad and is relevant to the current legitimate interests of the business. Again, the chances of enforcement of an NDA in favor of an employer will likely increase by showing a close nexus between the confidential information being sought to protect and a legitimate business interest.
A thorough review of employment policies and related law changes should be conducted by qualified legal counsel on a regular basis. It is imperative that a business have strong protections in place to protect its confidential information from dissemination by former employees or independent contractors.
For more information about rules governing employers in Illinois, or this article, please feel free to contact John W. Albee at Albee Law PC via telephone (312) 279-0115 or via email at jalbee@albeelaw.com.
