A non-disclosure agreement (often referred to as an NDA or a confidentiality agreement) protects confidential information that has been disclosed between two parties. It creates enforceable obligations between the parties, namely that they will not disclose or use any confidential information to third parties for any purpose other than that set out in the agreement.
A non-disclosure agreement may be used in a number of different settings, including in an employment setting or alongside a business transaction.
A non-disclosure agreement can be used to address different types of situations. It can be used where:
This agreement can be used where the parties to the agreement are resident in either England and Wales or Northern Ireland. For the equivalent agreement for parties resident in Scotland, please use the document: Confidentiality Agreement (Scotland).
Non-disclosure agreements and non-compete agreements are both commonly referred to collectively as 'post-termination agreements'. That is because both types of agreement are commonly used to impose restrictions after an agreement (particularly in an employment setting) has concluded.
No. It is not mandatory to have a non-disclosure agreement attached to another form of agreement. However, it is common for a business to use this type of agreement to protect its intellectual property and trade secrets. A non-disclosure agreement should only be used when necessary.
A covenant is a type of legal promise. In a non-disclosure agreement, a party will provide a covenant not to share certain information.
A non-disclosure agreement should never:
Before a non-disclosure agreement is signed, the restricted party should be provided with sufficient opportunity to read and understand the terms of the agreement. They should be afforded opportunity seek legal advice should they wish to do so. In an employment setting, the restricted party should be able to discuss the terms with a trade union representative.
A natural person entering into a legal agreement should have full capacity (meaning that they are of sound mind). Generally speaking, they should be over the age of 18*.
Entering into a contract with a child is complex, and specialist advice should be sought in those circumstances.
A party may also be a corporate entity with its own legal personality (a company).
A natural party should not:
A non-disclosure agreement should only remain in place for a period which is reasonable and necessary to protect the interests of the business. Typically, this will be between 3-5 years. Some information may need to be kept confidential indefinitely (such as important intellectual property or lists of customers).
After a non-disclosure agreement has been signed, each party should retain a signed version for future reference. The parties should ensure they comply with the terms of the agreement.
If the information involves one-way disclosure (meaning only one party is sharing information to the other) then the document must be executed as a deed*. The signature of each party to a deed must be witnessed.
If the information involves two-way disclosure (meaning both parties are sharing confidential information with each other) then the agreement may simply be signed and it is not necessary to have a witness.
The document will not be reviewed by a lawyer to ensure that the legal content applies to the personal situation of the parties. In order to review the particulars of any final agreement, it will be necessary to instruct a lawyer. For assistance finalising, reviewing and executing a deed, advice should be sought from a lawyer who is regulated by an approved regulator in the legal services sector. It is possible to search for a lawyer using the Law Society (England and Wales) – find a solicitor webpage or the Law Society (Northern Ireland) find a solicitor webpage.
If a non-disclosure agreement is not adhered to, the aggrieved party may initially send a warning notice to the other party. The aggrieved party may wish to apply to the Court for an injunction (an order to prevent further information sharing) and damages for any losses incurred.
A non-disclosure agreement should:
The key legal provisions applicable to a non-disclosure agreement are:
The Advisory, Conciliation and Arbitration Service (ACAS) provides detailed guidelines about confidentiality agreements in an employment setting.
You can choose to consult a lawyer if you need help.
The lawyer can answer your questions or help you through the process. You will be offered this option when you complete the document.
You fill out a form. The document is created before your eyes as you respond to the questions.
At the end, you receive it in Word and PDF formats. You can modify it and reuse it.
Non Disclosure Agreement (NDA) - Sample, template
Country: United Kingdom