Violating NDAs: What happens if you break an NDA?
Non-disclosure agreements are common in the workplace, but are they as ironclad as they seem? Here’s what happens if you break an NDA.
A non-disclosure agreement (NDA) is essentially a contractually obligated promise to keep a secret. Since it is a legal contract, there are consequences for breaking an employment NDA agreement.
Employment NDA agreement violations.
Since NDAs are civil contracts, breaking one isn’t technically a crime. However, it could come with severe financial penalties. Violating an NDA leaves you open to lawsuits from your employer, and you could be required to pay financial damages and possibly associated legal costs.
It’s illegal to reveal trade secrets or sensitive company information to a competitor. It can carry legal consequences, including fines and even jail time — even if you didn’t sign an NDA.
Breach of NDA penalties and consequences.
What happens if you breach an NDA? Simply put, a breach of NDA can have a range of consequences that are outlined in the NDA itself, or in the non-disclosure clause of your employment agreement.
You may be subject to legal liability, monetary fines and criminal charges in extreme cases. You may also have to pay any legal fees associated with your case and defense.
For many, breach of contract consequences aren’t worth the risk you’ll incur by actually going forward with a breach of NDA.
How to get out of an NDA.
To get out of an NDA, you have to be sure that it is legally binding. For example, you cannot be liable for an NDA that covers up illegal activity by the issuer. A lawyer can help you assess your risks and determine how you should move forward.
Here are other steps you can take if you’re wondering how to get around a non-disclosure agreement:
- Check for a termination clause. There may be certain requirements that must be fulfilled before closing your NDA.
- Check the language. If the legal language used is broad, you may have a case to sever the NDA early. A lawyer can help you determine if your NDA can be challenged.
- Determine if your content is “public domain.” If the content your NDA covers is now known by the public, you may be able to make a case to nullify your NDA from any specific issuer.
What should you include in an NDA?
If you’re a business owner or manage an HR department, NDAs can help protect your ideas, trade secrets, and business techniques. Of course, it only works if you include the right information in your employer NDA agreements:
- Specified time frame — How long does the NDA last?
- Description of confidential information — Include detailed descriptions of what’s considered confidential. You should also define what isn’t confidential to clear up any misunderstandings.
- Personal information — Be clear about who is involved in the NDA.
- Explanation of purpose — Explain why the information is confidential.
- Consequences — What happens if an employee breaks the NDA? Describe the consequences and who’s responsible for what (like legal fees).
It’s always best to consult a lawyer when drafting an NDA. They’re important legal documents, and you want to make sure you don’t leave out any vital information.
All non-disclosure agreements need to be signed by both the employee and the employer to make them valid. Electronic signature software like Acrobat Sign can speed up the process by allowing both parties to legally sign the NDA remotely with the click of a button. To ensure overall security, consider password protecting PDF documents.
Discover more about how Sign can help facilitate HR processes and protect your business information.
