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[2021]Why Sign an NDA with Employees?

June 17, 2021

When you are working on a business idea and want to assure that your proposition remains yours until you unveil the curtains, you need to sign an NDA(Non-Disclosure-Agreement) with the Employees or partners who are helping you to bring your dream to reality. But you are still unclear about the concept of NDA, and Why Sign an NDA with Employees? I would try to resort your queries through this blog.


Just in case you have a fair idea about what an NDA(Non-Disclosure-Agreement) is and how to register for an NDA? Then can directly jump to Why sign an NDA with Employees? Else let us continue.

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Here is what I will be covering in this blog:
What is an NDA(Non-Disclosure-Agreement)?
Confidentiality clause for an employee
Why sign an NDA with Employees?
How to generate an NDA for your firm or startup?

What is an NDA(Non-Disclosure-Agreement) for employees?

As the word suggests, a non-disclosure agreement is an agreement signed between an employee and a company. Under this agreement, the Employee ought not to discuss any confidential information with anyone without prior notice or knowledge of a company before the time period the agreement is valid.

Here, Confidential Information refers to all information, data, technical or non-technical, or description concerning any matters affecting or relating to Employee’s services for the Company, their business or operations, the products, drawings, plans, processes, or other data disclosed or provided by them to the Employee, whether disclosed or provided in oral, written, graphic, photographic, electronic or any other form.

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Confidentiality Clause for Employee:

After signing the agreement, the Employee agrees to:

  1. Hold the Confidential Information received from the Company in strict confidence and exercise a reasonable degree of care to prevent disclosure to others.
  2.  Not to disclose or divulge either directly or indirectly the Confidential Information to others unless first authorized to do so. 
  3.  Neither reproduce nor use confidential information commercially for any purpose other than the performance of his/her duties.
  4. Not to file any patent applications claiming any developments, discoveries, technologies, inventions, and the like arising from this Confidential Information.
  5. Promptly deliver all originals and copies of all documents, records, software programs, media, and other materials like software programs and other personal property containing any Confidential Information back to the Company.
  6. Right to take disciplinary action against him, up to and including termination, for violations of this agreement in addition to pursuing civil or criminal penalties.

Why Sign an NDA with Employees?

Here are seven benefits for signing an NDA with Employees:

  1. Since NDA is a legal document, it is of immense importance for any conflict that might arise in the future. 
  2. It provides the Company with confidence to share confidential information.
  3. Any party infringing the agreement would be legally liable to compensate for damages made to the Company that can adversely affect it.
  4. It clearly states (in written format) anything that comes under the term “confidential” in the long run avoiding any ambiguity or loss of information.
  5. It maintains the secrecy of the information shared between two or more parties and reduces the chances of important information going out of the organization.
  6. NDA for employees also protects the disclosure of intellectual property (including trade secrets, proprietary information, and other confidential information), safeguarding the organization as a whole.
  7. At any point, if the Company discovers confidential information which has been covered under a clause of NDA, has been leaked, the Company can hire an attorney and follow a legal road to deal with forgery. 

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This is how an actual NDA looks like:

NDA for employees

I hope you have got a fair idea about NDA and why you should sign an NDA with your employees before sharing any confidential information.

You can get your NDA by clicking on the generate now button.

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For more information related to NDA, or any other legal documents head over to esahayak.io now.

About Author

Blog Writer, Travel Enthusiast, Flutter developer, Student at University Institute of Engineering and Technology, Chandigarh.

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