Help with producing a good NDA

[chrisk]

Looking for some advice and pointers in the right direction before I engage a proper legal expert to finalise it. I will stress I will seek legal advice but thought some collective pointers will help me first.

I have the attached a scan of our current NDA for our employees, we are a merchant/broker business. No real trade secrets but customer lists and prices are important to us, I wouldn't want them going to a competitor.

Is the attached sufficient for new employees to stop them taking valuable information to competitors? I've been advised not and it would benefit from some more specific clauses and also some details where the NDA wouldn't apply, does it also need to be defined in terms of time (6 months perhaps?) and geographical location?

If I can gather some collective PH wisdom I will then re-draft for our business and run it past the firm's solicitor before implementing.

I'm also guessing I have to remind employees during exit interview of their obligations and if we do want customer lists to be treated as confidential I suppose we need to make sure we say they are more often and perhaps label them as such!?

Any help will be appreciated. and

[andy-xr]

Yes to all - as soon as an NDA is waved at me, I'm looking at what the company thinks they have over and above every other company when my role is to bring new contacts and sales to them. If it's just customers, they're a fickle lot. If it's IP, then that's reasonable enough to want to protect.

In recruiting sales people, an NDA is a double edged sword. There's the obvious side, that you dont want to see your customers walk out the door with a sales guy when he/she leaves. There's the not so obvious, as in how do you vet them coming in the door, and do you employ them based on what they can bring to you quickly. Because many decent sales guys will have customers that follow them around companies. Doing a grab on those will probably lead to lots of paper being waved around and losing customers and credibility as well.

Too restrictive (ie LinkedIn use/connections) will get laughed at and too lax means it's not worth spending the time, money and effort doing it.

I'd generally agree that a period of time would be a good plan for some instances (ie customers) but not others (price lists and your business model/technology). These things are generally known in the market through a process of deduction anyway though from your competitors analysis of how you're doing what you're doing.

[anonymous-user]

Is there any reason you can't use a properly drafted non-compete within the body of the employment contract?

Subject to the restrictions being as narrow as reasonable to protect your legitimate business interests, they are perfectly enforceable. Remedies then could be to injunct the ex-employee and new employer to prevent them from taking advantage of what they're not supposed to and/or getting them to account for profits if they already have. If the new employer is aware of the restrictions, they might then also be on the hook for inducing any breach of contract.

Knowing you have appropriate, enforceable post-termination restrictions, and that you're prepared to act if they're ignored, sends a powerful message to your workforce.