Confidentiality agreements are also known as nondisclosure agreements, NDAs and privacy agreements. These legal documents are binding contracts that help to protect sensitive information. In the agreement, one or both parties promise to not share confidential information with anyone who doesn't have authorization. The contract specifies exactly what information is protected, for how long and what the penalties are for breaking the confidentiality agreement.
Many businesses use NDAs when hiring employees. Sometimes, the confidentiality agreement is included as part of the employment contract. Employers may also include confidentiality clauses related to bonuses, compensation packages or salary increases.
Inventors may also use NDAs when showing pitching ideas to potential buyers. Confidentiality agreements are also common in business deals, such as mergers and acquisitions. The agreement allows both parties to share private financial information necessary for negotiations.
As a business owner, you want to protect your company's trade secrets and financial information. It's important to keep competitors from getting an unfair advantage over your company. Confidentiality agreements help you safeguard data such as customer details, employee lists, patents, accounting information, trademarks and proprietary industry secrets.
