Every business has confidential information or processes that give it a competitive advantage over competitors. These might include customer lists that have been developed with great expense and effort and special designs for products price formulas, code systems, or other inventions. The law protects business by requiring these documents or processes private to ensure that competitors are unable to easily access them.
In addition to these kinds of documents there are many other types of administrative records that have to be kept confidential. This could include detailed seating plans and office layouts and internal procedures. There may also be confidential information about customers, like sales numbers and confidential information from vendors. Then, you may have personal information about employees, such as tax forms and pay stubs.
A nondisclosure contract is the best method of protecting confidential company documents. However, you must be extremely careful when writing the agreement and defining the terms of what is considered to be confidential. You must be specific to avoid former or current employees from due diligence data room checklist claiming later they didn’t know the confidential information was protected by confidentiality policies.
Also, be clear about the duration of the nondisclosure agreement. It will not be valid if it is longer than is reasonable to protect the legitimate interests of a company or those that are “protectable”. In general, courts consider the circumstances to determine what is reasonable. Consider offering a raise or promotion in exchange for the employee’s signature in case you are concerned about them. This could be enough to deflect any allegations that you didn’t know the document was confidential.