Understanding Non-Disclosure Agreements
Non-Disclosure Agreements
Section titled “Non-Disclosure Agreements”In a non-disclosure agreement (NDA), two parties agree not to share sensitive information outside the workplace. NDAs protect corporate secrets.
For example, if you hire workers or contractors who need access to sensitive information to complete a task, you want them to keep that information private. An NDA makes that obligation binding and gives you a remedy if they breach it.
Standard clauses
Section titled “Standard clauses”The following provisions are commonly seen in NDAs:
- One-way or mutual. A unilateral NDA protects one party’s information; a mutual NDA protects both. In a one-way NDA, the party sharing information is the disclosing party and the other is the receiving party.
- Defined information. The agreement must state what information is confidential.
- Permitted use and disclosure. The agreement states the purposes for which the information may be used and who may receive it.
- Term. The agreement states when it is signed and how long it runs, and whether the confidentiality obligations survive the end of the contract.
- Remedies. The agreement sets out what happens if either party breaches it.