When a company wants to protect its intellectual property, inventions, techniques and secrets from outside the company and competitors, it signs employee non-disclosure agreement with the employees and business partners so that when they leave the company for any reason, they don’t leak or share the secret information to anyone else outside the organization. And, in any case if any party violates the clauses of the agreement, the company has the right to file law suit against that party and stop them from revealing the information to other people with the help of this agreement.
Brief Description of Employee Non-Disclosure Agreement:
When it comes to the secrets and intellectual properties of a company, there are two different scenarios. On one hand, it is very important of the top secret and high level government research institutes to keep their inventions and discoveries hidden from outside the world but they also have to hire hundreds of employees and anyone of them can leak or reveal the information to outsiders. On the other hand, with each new company in the market, the competition between companies and businesses is getting very tough and serious. In such situation, each business has to think of keeping their secrets and formulas hidden from their competitors and bound the employees not to reveal such high profile information to anyone besides the company and its employees. With the help of this agreement, it is very easy to protect the hidden information and secrets of a company and control the employees and their actions so that in any case, they don’t share the intellectual property of a company with anyone else.
Here is preview of a Free Sample Employee Non-Disclosure Agreement Template created using MS Word,
Key Elements to add in the Employee Non-disclosure Agreement:
- Name of the company
- Name of the employee or other parties
- Date when the agreement is effected
- Expiration or validity of the agreement
- Clauses of the agreement
- Reasons for signing this non compete agreement
- Specific geographical area for effectiveness of this agreement
- Compensation for the non competing party
- Termination of the agreement
- Signature of both parties and the witnesses
Importance and uses of Employee Non-disclosure Agreement:
It may sound like something very complicated and rarely happening but in reality, companies and corporations sign and deal with such agreements on regular basis and employees that work in such organizations are familiar with these agreements. In order to understand the use and importance of this agreement, suppose that you run a business that invents new technologies and electric gadgets regularly and the employees that are hired in the office, are well familiar with the techniques used in the company and if anyone of them tries to leak the information to someone else outside the company, it can put the whole business in jeopardy and cause a major loss or damage to the company. In order to protect your company and the intellectual property along with the secrets and new invented technologies, you should sign this contract with the employees working in the company so that when they decide to leave the company for some reason, they don’t share this information with anyone else i.e. with competitors, rivals and other similar companies.