How to Discuss Confidential Company Documents

Every business has some confidential procedures or data that give it an advantage over its competitors. These could include lists of customers that were created with a lot of effort and expense, unique product designs or pricing formulas, codes or systems, or any other inventions. The law safeguards businesses by making these procedures or documents confidential to ensure that competitors don’t have access to them.

There are also a number administrative items which need to remain private. This includes detailed seating plans and office layouts, as well as internal procedures. In addition, there could be confidential customer data like sales numbers, or other confidential information received from vendors. Last but not least you could have personal information about employees, like tax forms and pay stubs.

A nondisclosure agreement is the best method to protect confidential company documents. However, you have to be extremely cautious when drafting the agreement and establishing what information is considered confidential. Be specific to ensure that you don’t stop employees who are currently employed or former employees from later claiming that they did not know that the information was protected by confidentiality policies.

Also, be clear about the duration of the nondisclosure agreement. It’s not legally binding when the protection period is longer than is reasonable to safeguard the company’s legitimate or “protectable” interests. In general, the courts will take into consideration the circumstances and decide what is fair. If you are concerned about an employee, you might consider offering the promise of a raise or promotion in exchange for signing the agreement. This may be sufficient to deflect any claims that you didn’t know the document was confidential.

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