Protect your confidential info when working with other business owners, investors, or new hires.
The term “NDA” is thrown around a lot, but what does it actually mean and does it apply to your business?
A non-disclosure agreement is used any time confidential information about your business, your products, your services, your finances, your intellectual property, etc. that you would not want publicly disclosed, is disclosed to another party. Typically, in the case of online business, this is when an online business owner is considering a partnership or collaborations, and needs to disclose confidential information and trade secrets to the potential partner in the course of discussions about partnership or collaboration. Another example is when an online business owner is seeking investors or vendors for either their entire business, or maybe a new technology, or a new offering. Sometimes, a business owner will need to hire a contractor or employee and that hire will have access to confidential information.
-identifies all of the information that could possibly be considered confidential (so not only your trade secrets, but your client list, your business methods, your sales, your marketing, etc.)
-obligates the party receiving your confidential information to keep it confidential, even after you’re no longer working together, and even if the contemplated partnership/venture/transaction never happens
-prevents the party receiving your info from contacting and/or poaching your clients, contractors, and employees
-prevents the party receiving your confidential info from directly competing with you
-allows two parties contemplating work together the freedom to engage openly, knowing both parties have protected their confidential information from disclosure
-gives you the right to seek an injunction (court order preventing disclosure of your confidential information) or, if the information is disclosed, strict penalties
Specifics when hiring:
*If you are hiring a contractor and they don’t have a contract or you want to use your own contract (recommended, because then you (1) know exactly what the contracts says and that it comprehensively protects you and (2) you aren’t inadvertently agreeing to something you shouldn’t, because you’re signing a contract you don’t understand (if your contractor wants you to sign their contract), then use our Independent Contractor Agreement. It has an NDA built in to the contract.
*If a contractor wants you to sign their contract, make sure you have a lawyer review it first and have them sign this Non-Disclosure Agreement.
*If you are hiring an employee, you should speak with an employment lawyer to have an employment contract drafted. Use this NDA template with an employee, but it doesn’t cover non-competition (limiting an employee’s ability to leave and set up a competing business), which is highly specific to your geographic location. This NDA should only be used in conjunction with a lawyer-drafted employment agreement to cover the other aspects of an employer-employee relationship.
Are you planning on hiring someone (e.g. independent contractor, employee, consultant) who will have access to any information you wouldn’t want disclosed publicly?
Are you considering partnering or collaborating with another business owner, and in the course of discussing a potential business arrangement, you’ll disclose confidential business information about your products, your clients, your business methods, etc.?
Are you considering taking on investors?
Are you considering vendors to build out a new product or offer for you? (e.g. developing a mobile app for your coaching program)
If you answered yes to any of the above, you need this NDA to protect your confidential information.
**As a reminder if you didn’t see it at the bottom of the Details section, if you are hiring an independent contractor and they either don’t have their own contract or you’d prefer to use your own contract so you know what it means and that it adequately protects you, our Independent Contractor Agreement with built in NDA is your best bet. You don’t also need this NDA.
If you’re using an Independent Contractor Agreement of unknown origins (i.e. you can’t confirm a lawyer you trust drafted it 😉), you’re using your contractor’s contract, or you’re hiring an employee, use this NDA template in addition to the contract covering the scope of the relationship.
Side note: if you’re hiring an employee, you need a lawyer-drafted employment agreement to cover all of the nuances of an employer-employee relationship. This NDA is just covering protection of confidential information.