Originally Published: Sunday, 19 March 2000 Author: Jobs Staff
Published to: interact_articles_jobs_ask_staff/Ask the Jobs Staff Page: 1/1 - [Printable]

Ask the Jobs Staff: Non-disclosure agreements

Dear Jobs Staff - I've been working at my job for about a year now, and when I started I had to sign a non-disclosure agreement not to give away company secrets and so forth.

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Dear Jobs Staff:

I've been working at my job for about a year now, and when I started I had to sign a non-disclosure agreement not to give away company secrets and so forth. No problem. However, they've just given us a new one that seems to want us to give up all rights to any ideas or anything we've ever come up with while working here, gives the company power of attorney over us to sign anything computer-related, and prohibits us from working on anything related to the company for a certain amount of time after we leave. I understand that they want to protect company information, but this seems kind of over the top. I'm just concerned about whether I should go ahead and sign it, or if I don't, can they fire me? What should I do?

Joe M.

Dear Joe:

Your situation is actually quite common, and can be a difficult one depending on the strength of the non-disclosure agreement. You have a few options, but it's up to you which one may be the best in your situation. In any case, if it is at ALL possible, you should try to get an attorney to look over it for you before you sign it. This can be critical to your interests! You'll probably look at paying $200.00 - $500.00 US, but perhaps if your fellow employees all contribute, it won't be such a burden. While it can be argued that you shouldn't have to do that, it may be too important not to. It's also possible that your bosses will agree to reimburse you for the costs, and, at any rate, it might not hurt to ask them to do so. Of course, there are other options as well.

First, if the agreement is unacceptable to you, you might consider picking out the parts that are acceptable, and presenting it back to your bosses as a compromise. In other words, if you feel you can't agree to certain clauses, take them out, write up a new document, and say, "Well, I'll sign this one." If your fellow employees agree with you, perhaps you can all work together to grind out an agreement that protects the company and you. You can also explain to your bosses exactly what parts of the agreement you feel uncomfortable with and why: who knows, they may actually agree to strike out those portions of the agreement, making it a non-issue.

Second, and along the lines of the above option, you can run some web searches for "non-disclosure agreement" and see if you can find a template of a different one that might be more acceptable, and use that as your compromise. A search on Google.com for "template non-disclosure agreement" led us to Direct Stock Market's small business forms page which has templates for various things, one of which is a Non-Disclosure Agreement. If you leave out the word "template," you'll find even more examples. It's possible that one will be more palatable that the one you've been asked to sign.

Third, if you can't afford an attorney, you might want to find an attorney friend of the family, relative, or one that might be willing to help you in trade for, say, website development or other technical tasks. An attorney may be able to provide information about what parts of it are illegal or unenforceable under the law. For example, any agreements which would prevent you from earning a living under "non compete" clauses have often been proven unenforceable in various courts. Still, be careful about signing just because you feel it would be unenforceable. If it came to a legal fight, it could still cost you money and time to prove your case, and none of us want that.

Fourth, you can simply refuse to sign it. Of course, if you do so, be prepared for the fact that you could be fired for refusing. If you have other job options, you might want to tune up your resume and start looking. If need be, try explaining that you need some time to consider signing the agreement, and research the job market before you do refuse. It may very well be that your employer is fully within their rights to terminate your employment because you refuse to sign, so you'll need to consider this possibility.

As we mentioned before, this can be a very difficult situation. But bear in mind as well that this does not necessarily indicate that the company heads who have asked you to sign off are bad people or don't trust you. Often, investors or company attorneys want to have things like this on file so that they can feel secure about their intellectual property rights. We've talked to people who've had to sign extremely rigid NDA's as well as those which were more lenient, but many companies require their employees to sign some kind of agreement such as this. Sure, sometimes they go overboard with it, but many times if you are reasonable and explain the problems you have with it, you can work out a compromise. Hopefully, you work for a reasonable company -- there are some employers, unfortunately, who absolutely will not compromise in any way on things like this, in which case your choice may be to sign or leave. Then again, if your company is like that, you might want to ask yourself if you really want to work for that kind of organization.

Good luck!

The Jobs Staff





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