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Create a Confidential Information and Invention Assignment (Employee)

An employee confidentiality agreement is a contract that requires an employee to keep an employer's proprietary information confidential, only for work-related purposes. This form also gives the employer ownership over intellectual property and any inventions the employee creates during the employment period.

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Other names
An employee confidentiality agreement may also be called any of the following names:

Who should use this form?
A company usually develops a standard employee confidentiality agreement for all employees to complete. Unlike many legal agreements, employee confidentiality agreements are not negotiated.

Typically, after being hired, a new employee signs a confidentiality agreement. The new
hire usually must sign and date the employee confidentiality agreement to
continue employment with the business. Additionally, employers can request
existing employees to sign confidentiality agreements during the course of
employment. Regardless, employees should be allowed to
carefully review the document before signing it.

What to include in an employee confidentiality agreement
An employee confidentiality agreement form outlines terms and conditions for using
confidential, proprietary business information. Those terms should comply with
an employer's personnel manual, which should contain a section clearly stating
business policy for proprietary information.

This employee confidentiality agreement generally states that an
employee cannot disclose or profit from confidential company information.
The document also makes clear that all business data, including content
developed, written, or produced by the employee during the employment period,
belongs to the employer.

In addition, an employee confidentiality agreement may also state the following conditions:
  • Term of the agreement: This term will always at least cover a person's employment period, but may also include a period after s
  • Noncompete length of time: Following termination, this designation states the time period that a former employee cannot work for a competing business or within the same industry.
  • Personal business development length of time: Following termination, this designation states the time period that a former employee must wait before starting a business that could compete with the former employer's business.
All employee confidentiality agreements contain a clause that states the employee signing
the document understands the document's purpose and voluntarily agrees to the
terms outlined. This document ensures the employee cannot later challenge the
agreement or plead ignorance of the terms. For this reason, employees should
consult a lawyer if they're uncertain about the agreement terms.

Employers may consider asking an employment law attorney to check their employee
confidentiality agreement to make sure the terms are specific
enough to be enforceable but not unnecessarily restrictive.

Next steps
Both the employee and employer should sign final copy of the agreement. Each should securely file these copies for future reference.

Important Terms: