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Tips for protecting sensitive business data

Every business has something that sets it apart from the competition, whether it's their strategy for attracting customers or the design of their products. Keeping this information away from competitors and the public can be critical in preserving that competitive edge.

Employers will typically need to share this information with key employees in the company. These parties are typically valuable, trusted team members. However, things can change. Those employees may decide to leave the company or become disgruntled in the event of a dispute. This is why it is often wise to have employees with knowledge of confidential information sign a non-disclosure agreement.

A non-disclosure agreement is a legal document. When valid, it deters employees from stealing and/or disclosing the confidential data to unauthorized parties.

To make your NDA effective and enforceable, take the following few precautions:

  1. Be specific - If you are vague in a contract and do not specify the information warranting protection, the agreement may be unenforceable. Failure to be specific can leave you and the agreement open to challenges in court.
  2. Be judicious - You likely do not need to have every employee sign a NDA. Further, not every piece of business data warrants protection with such an agreement. To ensure your agreement is effective and to avoid unnecessary disputes, be reasonable when deciding who must sign the agreement and whether you have information warranting protection in the first place.
  3. Be prepared to act - If you believe that a contracting party breached the agreement and disclosed protected information, you will need to take action. This includes investigating where the leaked information came from, who received the information and the damages caused by the release of information. Oftentimes, this is a very complex process, so having legal guidance can be crucial.

Protecting confidential information can be a top priority for any owner of a small- or medium-sized business. Even a single incident of leaked information could jeopardize the future of the company. Therefore, it is crucial for employers to take their legal options seriously and pursue lawful, effective means of protecting themselves and their business.

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