Non-disclosure agreement

An employee can be required to sign an NDA or NDA-like agreement with an employer, protecting trade secrets.

In fact, some employment agreements include a clause restricting employees' use and dissemination of company-owned confidential information.

In some cases, employees who are dismissed following their complaints about unacceptable practices (whistleblowers), or discrimination against and harassment of themselves, may be paid compensation subject to an NDA forbidding them from disclosing the events complained about.

A multilateral NDA can be advantageous because the parties involved review, execute, and implement just one agreement.

This advantage can be offset by more complex negotiations that may be required for the parties involved to reach a unanimous consensus on a multilateral agreement.

[8] They have been described as "an increasingly popular way of restricting the loss of R&D knowledge through employee turnover in Indian IT firms".

Case law in a 2013 Court of Appeal decision (Dorchester Project Management v BNP Paribas) confirmed that a confidentiality agreement will be interpreted as a contract subject to the rules of contractual interpretation which generally apply in English courts.

[16] NDAs are often used as a condition of a financial settlement in an attempt to silence whistleblowing employees from making public the misdeeds of their former employers.

Ricoh sought release from its obligations under the agreement via an application for summary judgment, and the court agreed that the relevant wording "went further than could reasonably be required" to protect commercial information.

California's courts and legislature have signalled that they generally value an employee's mobility and entrepreneurship more highly than they do protectionist doctrine.