There’s a lot that goes into running a successful business. You probably have some sensitive information about your processes, recipes, designs or clients that would ruin or seriously harm your business if it were to fall into the hands of a competitor. With employee turnover, how do you minimize the chances of one of your ex-employees bringing your proprietary information with them to a new job?
Non-disclosure vs non-compete agreements
Non-disclosure agreements often go hand in hand with non-compete agreements, and employers often have new employees sign both kinds of agreements upon hiring them or soon thereafter.
Non-compete agreements prohibit a former employee from competing with your business in a specific area for a specific duration of time after they leave your employment. This prevents them from stealing your clients or undercutting your services as soon as they quit or are fired from your company
Non-disclosure agreements, on the other hand, deal with the type of information that they are prohibited from disclosing about your company. They bind former employees to secrecy about your proprietary information even if that employee is not violating their non-compete agreement.
In other words, your non-compete agreement might prevent your former employee from starting a new business in the same industry as yours. But even if that former employee goes to work for an entirely different company in a different field, they still cannot use your proprietary information to benefit their new company because of the non-disclosure agreement they signed.
As a business owner, you should have several different tools in your belt to protect your business in a variety of situations. Having all of your current employees sign a non-disclosure agreement to go with their non-compete agreement is just one more step you can take to ensure that your proprietary information remains safe from competitors.